The Pakistani rupee remained unchanged against the US dollar in the open market on Monday, while the local currency improved marginally in the inter-bank market.
During the day, currency dealers Business Recorder reached out to said the rupee was being quoted at 284.50 for selling and 281.50 for buying purposes for customers. The rupee closed at the same rates.
During the previous week, the currency gained 25 paisa for both buying and selling against USD, closing at 281.50 and 284.50, respectively, according to data provided by the Exchange Companies Association of Pakistan (ECAP).
In the inter-bank market, the rupee closed at 283.21 against the US dollar.
Despite low foreign exchange reserves, the market remains confident amid an expected release of funds by the International Monetary Fund (IMF) next month, said experts.
In November, Pakistan and the IMF reached a staff-level agreement (SLA) on the first review of the country’s nine-month SBA.
Tresmark research in its recent note warned that the rupee is expected to face challenging times ahead on account of ‘zero growth’.
“Traders are factoring in a 5-10% depreciation of Pakistani rupee next year as Pakistan suffers from near zero growth, low productivity, higher repayments with fewer avenues for raising forex.
“In the current scenario, the economy is grappling with a slowdown in imports (fresh LC openings), a decline in both exports and remittances, creating a stifling effect exacerbated by persistent inflation.
“However, a significant challenge emerges: allowing the Rupee to depreciate could trigger another round of inflation, posing a potential back-breaking burden for all stake holders,” it warned.
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