September 03, 2021 (MLN): Pakistani rupee (PKR) managed to gain some strength after enduring a bleak phase of depreciation as the domestic unit closed Friday’s trade at PKR 166.91 per USD, appreciating by 8 paisa in interbank market, against yesterday's closing of PKR 166.98 per USD.
The slight appreciation in rupee is attributable to the surge in foreign exchange reserves as the liquid foreign reserves reached $27.227billion on August 27, 2021.
However, the home unit is still under the pressure as the dollar out flow is greater than the inflow that has widened the trade gap, as per Asad Rizvi, the former Treasury Head at Chase Manhattan.
Under the present circumstances, SBP’s absence and tolerance is a clear message to the market, he added.
The rupee endured a relatively dull trading session with very little intraday movement, trading in a range of 34 paisa per USD showing an intraday high bid of 167.15 and an intraday Low offer of 166.90.
During the week, the currency has lost 1.3 rupees against the greenback, as the previous week was concluded at PKR 165.62 per USD.
Within the Open Market, PKR was traded at 166.70/168.25 per USD.
The home unit has depreciated by 5.61% and 4.24% in FY22 and CY21, respectively with the month-to-date (MTD) position showing a drop of 3.34%, as per the data gathered by Mettis Global.
Alternatively, the currency lost 66 paisa to the Pound Sterling as the day's closing quote stood at PKR 230.88 per GBP, while the previous session closed at PKR 230.21 per GBP.
Similarly, PKR's value weakened by 34 paisa against EUR which closed at PKR 198.15 at the interbank today.
On another note, within the money market, the State Bank of Pakistan (SBP) conducted an Open Market Operation in which it injected Rs.1.99 trillion for 7 days at 7.1 percent.
The overnight repo rate towards close of the session was 7.20/7.40 percent, whereas the 1 week rate was 7.10/7.20 percent.
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