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coronavirus
Coronavirus
VERY HIGH
Source: covid.gov.pk
Pakistan Deaths
29,042
524hr
Pakistan Cases
1,345,801
6,80824hr
Sindh
513,046
Punjab
456,992
Balochistan
33,780
Islamabad
113,688
KPK
182,950

Pakistan's rupee gained against the US dollar for the third successive day, closing at 171.65 in the inter-bank market on Friday.

As per the State Bank of Pakistan (SBP), the PKR settled at 171.65 against the USD after a day-on-day appreciation of Rs0.61 or 0.36%. On Tuesday this week, the PKR had dropped to its lowest level against the US dollar, closing over the 175 level for the first time in the inter-bank market.

The appreciation comes on the back of Saudi Arabia's $4.2-billion support package that has 'cooled' off the currency market that had seen the rupee under immense pressure since May this year. The rupee lost close to 13% in five months before the three-day respite.

Pakistan's rupee recovers 1.44% against US dollar as KSA support cools off market

On Tuesday night, the Saudi Fund for Development (SFD) announced the issuance of the Royal Directive to deposit an amount worth of $3 billion into the central bank of Pakistan. Additionally, the SFD said that the royal directive was also issued to finance the oil derivatives trade with a total amount of $1.2 billion throughout the year.

The announcement came at a time when foreign exchange reserves held by SBP declined by $346 million on a weekly basis to $17.146 billion on October 22. The central bank did not provide a reason behind the decrease. The data, released by the SBP Thursday evening, stated overall reserves held by Pakistan amounted to $23.933 billion. Reserves held by commercial banks amounted to $6.787 billion.

SBP's foreign exchange reserves decline $346 million, now stand at $17.146 billion

"The rupee is expected to strengthen further in the coming days," Sana Tawfik, analyst at Arif Habib Limited (AHL), told Business Recorder.

Tawfik was of the view that Pakistan’s Real Effective Exchange Rate (REER) index for September also shows that the PKR is still undervalued and there is "room for appreciation".

The country’s REER fell to 95.9 in the month of September 2021, falling 0.7 percent compared to the month before, shared SBP on Tuesday.

“We expect the REER reading for the month of October to be around 93-94, suggesting more room for PKR appreciation,” said Tawfik.

"Developments including a 24% decline in the current account deficit, the recently-announced $4.2 billion financial assistance, and an agreement for the Debt Service Suspension Initiative (DSSI Phase-II) for Euro 26.213 million signed between Germany and Pakistan have created a positive sentiment.

"Exporters are also selling their forwards in the market, which has also improved the dollar supply."

Tawfik added that the expected successful conclusion of IMF negotiations would also add to the positives. The rupee, she said, could appreciate to 168-169 against the USD by the end of this year.

Inter-bank market rates for dollar on Friday

BID Rs 171.56

OFFER Rs 171.66

Open-market movement

In the open market, the PKR gained 30 paisas for buying and 20 paisas for selling against USD, closing at 171.80 and 172.80, respectively.

Against Euro, the PKR gained 40 paisas for both buying and selling, closing at 199.10 and 201, respectively.

Against UAE Dirham, the PKR gained 20 paisas for buying and 15 paisas for selling, closing at 48.40 and 48.85, respectively.

Against Saudi Riyal, the PKR gained 25 paisas for both buying and selling, closing at 45.35 and 45.80, respectively.

Open-market rates for dollar on Friday

BID Rs 171.80

OFFER Rs 172.80

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Rasheed Oct 30, 2021 06:32pm
The dollar will further go down after the completion of harvesting of rice and expoting of other grains
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Rasheed Oct 30, 2021 06:34pm
Dollars will further go down after completion of harvesting of crops
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