PKR on a Roll: Gains 93 paisa against greenback

February 20, 2023 (MLN): Continuing its winning streak against the US dollar, the Pakistani rupee (PKR) has appreciated by 93 paisa against the US dollar in today's interbank session as the currency settled the day's trade at PKR 261.88 per USD compared to last session's closing of PKR 262.82 per USD.

Throughout the session, the local unit traded in a band of 1.85 rupees, showing an intraday high bid of 262.85 and low offer of 261.50 while in the open market, PKR was traded at 262/265 per USD.

The local unit is on the gaining spree in the hope of revival of the International Monetary Fund (IMF) program as the government is on its toes to comply with all the conditions tabled by the fund.

Meanwhile, on the economic front, Pakistan posted a current account deficit (CAD) of $3.8 billion in 7MFY23, improving by 67.13% YoY as compared to the same period last year.

In the month of January 2023, CAD narrowed by 90% YoY and 16.55% MoM to $242 million compared to $2.46mn in January 2022 and $290mn in December 2022.

It is pertinent to note that the country witnessed a 23 monthly low CAD this month.

In addition, the Foreign Direct Investment (FDI) in the country jumped by over 2x YoY to $222.6mn in January 2023.

In FYTD, PKR lost 57.03 rupees or 21.78%, while it plummeted by 35.45 rupees or 13.54% against the USD in CYTD. On the other hand, within the last seven sessions, the local unit moved up by 2.89%, as per data compiled by Mettis Global.

Alternatively, the currency lost 2.2 rupees to the Pound Sterling as the day's closing quote stood at PKR 315.5 per GBP, while the previous session closed at PKR 313.34 per GBP.

Similarly, PKR's value weakened by 37 paisa against EUR which closed at PKR 280.19 at the interbank today.

On another note, the State Bank of Pakistan (SBP) conducted a Shariah-compliant Mudarabah Open Market Operation (OMO) today, in which it injected Rs125.6 billion into the market for 4 days at a 17.08% rate of return.

The overnight repo rate towards the close of the session was 16.25%/16.4%, whereas the 1-week rate was 16.55%/16.65%.

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