PKR on a winning streak, gains 1.06 rupees against USD

October 05, 2023 (MLN): The Pakistani rupee (PKR) continued its steady rise, appreciating by 1.06 rupees against the US dollar in Thursday's interbank session to settle the trade at PKR 283.62 per USD, compared to the previous session's closing of PKR 284.68 per USD.

The local unit saw an intraday high (bid) of 284.55 and a low (ask) of 283.5.

In the open market, the local unit gained 50 paisa as exchange companies quoted the dollar at 281 for buying and 283.8 for selling, compared to the previous closing of 281.5 for buying and 283.5 for selling.

It is pertinent to note that the local unit has finished the month of September marked by second-best performance since 2014 in percentage terms, gaining 6.19% against the US dollar and earning the coveted title of the best-performing currency in the world for the month.

In stark contrast to the bleak macros that had plagued the Pakistani rupee, the army-backed crackdown on the illegal dollar trades has significantly helped the PKR.

Moreover, recent reforms introduced by the State Bank of Pakistan (SBP) to consolidate and transform various types of exchange companies into a single category with a well-defined mandate and higher capital requirements are also enhancing transparency.

To note, SBP suspended the authorization of four exchange companies in September, underscoring the central bank's commitment to ensuring compliance with regulatory standards.

These reforms also apply to the banks actively engaged in foreign exchange business, mandating them to set up wholly owned ECs to address the legitimate foreign exchange needs of the general public.

Following the guidelines of the central bank, certain banks such as; Bank Al Falah Limited (BAFL), Faysal Bank Limited (PSX: FABL),  Allied Bank Limited (PSX: ABL), Bank Al Habib Limited (PSX: BAHL), MCB Bank Limited (PSX: MCB), Meezan Bank Limited (PSX: MEBL), and United Bank Limited (PSX: UBL), have decided to establish their own exchange company.

In comparison to major currencies, PKR gained 20 paisa against the Euro, closing at 298.13 compared to the previous value of 298.33

The British Pound became expensive by 18 paisa closing at 344.16 compared to 343.98 from a day ago.

The Swiss franc saw losses of 11 paisa, closing at 309.3 compared to 309.4 from the previous session.

Against the Japanese Yen, PKR gained 0.9 paisa, closing at 1.903 versus 1.912 a day ago.

The Chinese Yuan lost 14 paisa, closing at 38.8446 against 38.9893 from the previous session.

The Saudi Riyal closed at 75.62 with a loss of 28 paisa from its value of 75.9 a day ago.

The U.A.E Dirham decreased in value by 29 paisa from 77.504 a day ago to 77.217.

During the current financial year, PKR has appreciated against the Dollar by 2.37 rupees or 0.83%. While the current calendar year has seen PKR depreciate by 57.19 rupees or 20.17%.

In the Money Market, the benchmark 6-month Karachi Interbank Bid and Offer rates inched down by 8 bps to 22.65% and 22.9%.

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