April 11, 2022 (MLN): Following easing political chaos, the Pakistani rupee (PKR) staged a smart recovery against the US Dollar (USD) for the second successive day, closing at 182.93 with a gain of 1.8 rupees in the interbank market on Monday.
In the last session, snapping its long losing streak, the domestic unit had closed the trade at 184.68 per USD, after witnessing a massive fall of two rupees.
The clarity on the political landscape after the ouster of PM Imran Khan from the premiership in a no-confidence vote by the parliament and massive monetary tightening by the central bank to counter the external shocks and inflationary pressures supported the rupee from further fall.
In an interview with Bloomberg today, the Governor State Bank of Pakistan (SBP) Reza Baqir said that Pakistan is working to draw a $3 billion balance from the International Monetary Fund (IMF).
Recently, IMF talks with Pakistan had been deferred due to political instability in the country.
The investors are hopeful that the new regime would continue engagement with the fund and improve the country’s economic outlook which would likely ease the further pressure on the rupee.
However, a research note by Ismail Iqbal Securities stated that the country will have to pay $2.5bn on account of external debt servicing in the last quarter of FY22. These payments are likely to put pressure on PKR against the greenback in the coming days,
The rupee saw moderate volatility in today’s session and traded in a range of 1.05 rupees per USD, showing an intraday high bid of 183.55 and an intraday low offer of 182.70.
Within the Open Market, PKR was traded at 184/186 per USD.
From July’21 to date, the local unit has lost Rs25.38 or 13.88% against the USD. Similarly, the rupee fell by Rs6.42 or 3.51% in CY22. While, the month-to-date (MTD) position showed a gain of 0.30%, as per data compiled by Mettis Global.
During the last 52 weeks, PKR lost 16.76% against the greenback since its high of 152.27, seen on May 07, 2021.
Furthermore, the local unit has weakened by 8.99% against EUR since its high on April 12, 2021, while it has dropped by 11.83% against GBP since its high on April 12, 2021.
On the other hand, month to date position depicted that PKR has appreciated against other currencies as the home unit strengthened by 2.64%, 1.22%, 1.51%, 3.38%, 0.27%, and 0.30% against EUR, GBP, CHF, JPY, SAR, and AED, respectively.
Meanwhile, in today’s session, the currency gained 2.5 rupees against the Pound Sterling as the day's closing quote stood at PKR 238.12 per GBP, while the previous session closed at PKR 240.65 per GBP.
Similarly, PKR's value strengthened by 98 paisa against EUR which closed at PKR 199.48 at the interbank today.
On another note, within the money market, the overnight repo rate towards the close of the session was 12.25/12.50 percent, whereas the 1-week rate was 12.25/12.35 percent.
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