PKR drops by 36 paisa in interbank

February 28, 2022 (MLN): Enduring a spell of depreciation, the Pakistani rupee (PKR) witnessed another fall of 36 paisa against the US dollar in today's interbank session as the currency closed the day's trade at PKR 177.47.

During the session, the rupee traded in a range of 45 paisa per USD showing an intraday high bid of 177.55 and an intraday low offer of 177.30.

Throughout the month of February, the domestic unit lost 75 paisa or 0.42% against the depreciation of 0.12% and 1.27% in January 2022 and February 2021, respectively while riding a seesaw journey. 

In addition to the dwindling current account balance on huge imports, the domestic unit has been also been enduring pressure from geopolitical instability owing to the Russian invasion in Ukraine. The currency will witness a major hit as the global market is witnessing a historic surge in commodities prices and threats of supply shortages.

“With ban imposed on Russian Banks using SWIFT and if it reacts oil prices could possibly skyrocket. Though it may seem direct impact of conflict will be minimal on our economy,” Asad Rizvi, the former Treasury Head at Chase Manhattan said.

A storm is brewing, he added.

Meanwhile, the local unit has lost Rs19.9 against the USD from July’21 to date, while, the rupee depreciated by 0.95 paisa in CY22, with the month-to-date (MTD) position showing a drop of 0.42%, as per data compiled by Mettis Global.

On the other hand, the performance of PKR remained comparatively better against major currencies during the year to date as the local unit appreciated by 1.75%, 1.61%, 1.47%, 1.39% and 1.37% against AUD, EUR, CAD, CNY and CHF, respectively.

Within the open market, PKR was traded at 177.50/178.50 per USD.

Alternatively, the currency gained 11 paisa against the Pound Sterling as the day's closing quote stood at PKR 237.54 per GBP, while the previous session closed at PKR 237.65 per GBP.

Similarly, PKR's value strengthened by 3 paisa against EUR which closed at PKR 198.55 at the interbank today.

On another note, within the money market, the overnight repo rate towards the close of the session was 9.90/10.00 percent, whereas the 1-week rate was 9.85/9.95 percent.

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