PKR edges higher by 5 paisa per USD

March 07, 2023 (MLN): Holding its gaining momentum, the Pakistani rupee (PKR) on Tuesday inched up by 5 paisa against the greenback in the interbank session as the currency settled the trade at PKR 277.87 per USD, compared to yesterday's closing of PKR 277.92 per USD.

Throughout today’s session, the local unit traded in a band of 2.8 rupees, showing an intraday high bid of 277.80 and low offer of 276 while in the open market, PKR was traded at 276.5/280 per USD.

The local unit has gained value due to positive sentiments towards the International Monetary Fund (IMF) and the renewal of Chinese loans. Recent reports suggest that the IMF will sign a staff-level agreement (SLA) before the end of this week, as the government has successfully fulfilled all the IMF's reform prerequisites, including the development of reserves.

 This achievement is evident in the $1.3 billion loan rollover by the Industrial and Commercial Bank of China Ltd.

 Furthermore, the State Bank of Pakistan (SBP) received a significant boost of $700 million from China in February, which helped to bolster foreign exchange reserves.

In FYTD, PKR lost 73.09 rupees or 26.28%, while it plummeted by 51.43 rupees or 18.51% against the USD in CYTD. On the other hand, within the last seven sessions, the local unit moved down by 5.89%, as per data compiled by Mettis Global.

Alternatively, the currency lost 76 paisa to the Pound Sterling as the day's closing quote stood at PKR 335.11 per GBP, while the previous session closed at PKR 334.35 per GBP.

Similarly, PKR's value weakened by 1.6 rupees against EUR which closed at PKR 297.14 at the interbank today.

On another note, within the money market, the central bank on Tuesday conducted an Open Market Operation (OMO), in which it injected a total of Rs54 billion into the market at a 20.02% rate of return for 3-day tenure.

The overnight repo rate towards the close of the session was 20.00/20.25%, whereas the 1-week rate was 19.75%/19.85%.

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