- Rupee closes at 206.87, ending two-day depreciation run in inter-bank market
The rupee ended its two-day depreciation run against the US dollar, dropping below the 207 level at close on Tuesday, as Pakistan and the International Monetary Fund (IMF) inched closer to reviving the bailout programme.
As per the State Bank of Pakistan (SBP), the rupee closed at Rs206.87 against the greenback, a gain of Rs1.07 or 0.52%.
On Monday, the rupee had fallen by 46 paisas or 0.22% to close at Rs207.94 against the US dollar.
In an early morning development, Pakistan received combined economic and financial targets for the seventh and eighth reviews of its IMF bailout programme, said Finance Minister Miftah Ismail.
On Twitter, Miftah said the government had received the lender's Memorandum of Economic and Financial Policies (MEFP) for both reviews, following meetings last week between the two sides.
Later in the day, Prime Minister Shehbaz Sharif said that the IMF will club the seventh and eighth reviews of Pakistan's Extended Fund Facility (EFF), and disburse roughly $1.9 billion in the coming days. The combined reviews mean disbursement of roughly twice the amount being expected by Pakistan earlier, which was around $900 million.
The IMF programme is widely seen as crucial for Pakistan's economy, which has struggled with high inflation and a widening current account deficit. The deterioration has caused the rupee to hit all-time lows several times during the year, with nearly 15% depreciation this calendar year alone.
“The appreciation comes amid two to three positive developments, including development on the IMF front, inflows to the tune of $2.3 billion from China, and a slowdown in global commodity prices,” Saad Khan, Head of Research at IGI Securities Limited, told Business Recorder.
He said he expects the rupee to appreciate close to 200 in the short-run following these developments.
He also said the rupee could be impacted by current account deficit figure, which he expected to be on the higher side owing to slowdown in remittances and outflow of dollars due to repatriation of profits from companies. However, things will normalise in the coming months, he added.
Meanwhile, current account figures that were released by the SBP later on Tuesday showed Pakistan’s deficit at $1.43 billion for May 2022, compared to $640 million recorded in the same period of the previous year.
Inter-bank market rates for dollar on Tuesday
BID Rs 206.20
OFFER Rs 206.40
In the open market, the PKR remained unchanged for both buying and selling against USD, closing at 204.50 and 206.50, respectively.
Against Euro, the PKR remained unchanged for buying while losing one rupee for selling, closing at 215 and 217, respectively.
Against UAE Dirham, the PKR remained unchanged for both buying and selling, closing at 56 and 56.50, respectively.
Against Saudi Riyal, the PKR remained unchanged for both buying and selling, closing at 54.80 and 55.30, respectively.
Open-market rates for dollar on Tuesday
BID Rs 204.50
OFFER Rs 206.50