5th successive decline: rupee settles at 219.71 against US dollar

Pakistan’s rupee registered a decline for the fifth straight session against the US dollar, and depreciated 0.37% in the inter-bank market on Tuesday.

As per the State Bank of Pakistan (SBP), the rupee closed at 219.71 after depreciating Re0.82 or 0.37%. The rupee has cumulatively depreciated Rs1.92 or 0.87% in the last five trading sessions.

On Monday, rupee had registered a decline for the fourth successive session against the US dollar, and closed at 218.89 after a fall of Re0.46 or 0.21%.

After witnessing an appreciation run since the last week of September, amid a shift in sentiment driven by Ishaq Dar's appointment as the Finance Minister, the rupee is now reverting to its old ways amid dwindling foreign exchange reserves and the Dar euphoria seems to be tapering off.

The finance minister, in a recent interview with Reuters, had said that the “true value” of the rupee was at a level under 200 to the dollar. “I am for a stable currency; I am for a realistic rate. I am for market-based, but not subject to a currency being taken hostage” and making speculators billions of dollars," he added.

Meanwhile, Samiullah Tariq, Head of Research at Pakistan Kuwait Investment Company (Private) Limited, told Business Recorder that import payment pressure has renewed after an increase in demand.

"The import bill for the ongoing month could cross $5.5 billion. However, sentiments would change after the board meeting of the Asian Development Bank (ADB), scheduled to be held on October 21," said Tariq.

“Moreover, a decision from the Financial Action Task Force (FATF) regarding Pakistan’s status on the grey-list would also impact the rupee trajectory."

Globally, the dollar hovered near a 32-year peak above yen on Tuesday even as it took a breather from a rally against other major peers.

The US dollar index – which measures the greenback against six major peers, including the yen, euro, and sterling – sagged near a 1-1/2-week low as a dramatic U-turn over the UK’s controversial tax-slashing “mini-budget” buoyed European currencies.

Oil prices, a key determinant of currency parity, edged lower on Tuesday based on fears of an economic slowdown and lower fuel demand from China as it persists with its stringent zero-COVID policy.

Inter-bank market rates for dollar on Tuesday

BID Rs 219.75

OFFER Rs 220.75

Open-market movement

In the open market, the PKR lost 50 paisas for both buying and selling against USD, closing at 224 and 226.20, respectively.

Against Euro, the PKR lost 2 rupees for both buying and selling, closing at 220 and 222 respectively.

Against UAE Dirham, the PKR lost 20 paisas for both buying and selling, closing at 61 and 61.60, respectively.

Against Saudi Riyal, the PKR lost 20 paisas for buying and 5 paisas for selling, closing at 59.45 and 59.85, respectively.

Open-market rates for dollar on Tuesday

BID Rs 224

OFFER Rs 226.20