PKR appreciates by 86 paisa in interbank, 1 rupees in open market against USD

September 14, 2023 (MLN): The Pakistani rupee (PKR) maintained its upward momentum for seven consecutive days, appreciating by 86 paisa against the US dollar in Thursday's interbank session to settle at PKR 297.959 per USD, compared to the previous session's closing of PKR 298.82 per USD.

The currency saw an intraday high (bid) of 298 and a low (ask) of 297.95.

Similarly, in the open market, the local unit gained 1 rupee as the exchange companies quoted the dollar at 296 for buying and 299 for selling, compared to the previous closing at 297 for buying and 300 for selling.

The upward momentum is attributed to the ongoing crackdown against speculators, hoarders, and smugglers to restrict illegal dollar outflows.

Market talks suggest that the exporters had been selling dollars on a large scale out of fear of further devaluation.

Moreover, the recent reforms introduced by the State Bank of Pakistan (SBP) aim to consolidate and transform various types of exchange companies into a single category with a well-defined mandate and higher capital requirements.

These reforms are also encourage leading banks to establish wholly owned exchange companies to cater to the legitimate foreign exchange needs of the general public.

"The army chief took notice, and the restoration of supply in the open market is credited to him," Malik Bostan, chairman of the Exchange Companies Association of Pakistan (ECAP) told Reuters.

"A task force was made that is now cracking down on the illegal market," he added.

Investors' key focus remains on the MPC meeting scheduled today, wherein the consensus is that of a 100 basis points (BPS) rate hike.

In comparison to major currencies, PKR gained 1.08 rupees against the Euro, closing at 319.89 compared to the previous value of 320.97.

The British Pound became cheaper by 48.27 paisa closing at 372.12 compared to 372.60 from a day ago.

The Swiss franc saw losses of 1.53 rupees, closing at 333.39 compared to 334.93 from the previous session.

Against the Japanese Yen, PKR gained 0.59 paisa, closing at 2.023 versus 2.029 a day ago.

The Chinese Yuan lost 8.81 paisa, closing at 40.95 against 41.04 from the previous session.

The Saudi Riyal decreased in value by 23.33 paisa from 81.35 a day ago to 81.12.

The U.A.E Dirham closed at 79.44 with a loss of 22.63 paisa from its values of 79.66 a day ago.

During the current financial year, PKR has depreciated against the Dollar by 11.97 rupees or 4.02%. While the current calendar year has seen PKR depreciate by 71.53 rupees or 24.01%.

In the Money Market, the benchmark 6-month Karachi Interbank Bid and Offer rates inched down by 3 bps to 24.43% and 24.68%.

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