Rupee gains momentum, settles at 283.47 against US dollar

The Pakistani rupee regained its upward momentum against the US dollar, appreciating 0.15% during trading in the inter-bank market on Thursday.

According to the State Bank of Pakistan (SBP), the local currency settled at 283.47, an increase of Re0.42.

The development comes after the rupee remained largely stable against the US dollar on Wednesday, settling at 283.89 in the inter-bank market, and as market participants await resumption of the International Monetary Fund (IMF) Extended Fund Facility (EFF), which has remained stalled since last year.

In a key development, Pakistan’s current account posted a massive surplus of $654 million in March against a (revised) deficit of $36 million in February 2023, reported the State Bank of Pakistan (SBP) on Wednesday.

“Cumulatively, the current account deficit reduced to $3.4 billion in July-March FY23 against a deficit of $13 billion in July-March FY22,” the SBP said in a statement.

This is the first surplus on a monthly basis since November 2020 when the pandemic had brought the global economy to a standstill.

However, experts believe that maintaining a current account surplus is “unsustainable” in the long run because if Pakistan opens its economy, imports will rise and the deficit will return.

Globally, the US dollar held gains on Thursday after strong US banking results firmed up expectations that the Federal Reserve will keep monetary policy tight for a while longer.

The dollar index, which tracks the currency against a basket of its peers, was little changed at 101.96 after climbing 0.27% on Wednesday.

Oil prices, a key indicator of currency parity,fell in Asian morning trade on Thursday as the US dollar strengthened on rate-hike expectations and after recent economic data from the US and China did not do enough to encourage expectations that demand will improve.

Inter-bank market rates for dollar on Thursday

BID Rs 283.45

OFFER Rs 285.50

Open-market movement

In the open market, the PKR lost 3 rupees for both buying and selling against USD, closing at 289 and 292, respectively.

Against Euro, the PKR lost 2 rupees for both buying and selling, closing at 312 and 315 respectively.

Against UAE Dirham, the PKR lost 1.20 rupee for buying and 1.25 rupee for selling, closing at 78.50 and 79.25, respectively.

Against Saudi Riyal, the PKR lost 5 paisa for buying and 15 paisa for selling, closing at 75.75 and 76.45, respectively.

Open-market rates for dollar on Thursday

BID Rs 289

OFFER Rs 292