September 15, 2023 (MLN): The Pakistani rupee (PKR) appreciated by 1.11 rupees against the US dollar in Friday's interbank session as the currency settled the trade at PKR 296.849 per USD, compared to the previous session's closing of PKR 297.959 per USD.
The currency saw an intraday high (bid) of 297.2 and a low (ask) of 297.
In the open market, the local unit remained stable as the Exchange Companies quoted the dollar at 296 for buying and 300 for selling, while during the week, PKR appreciated by 5 rupees, compared to the previous week's closing of 301 for buying and 305 for selling.
The upward momentum is attributed to the ongoing crackdown against speculators, hoarders, and smugglers to restrict illegal dollar outflows.
Market talks suggest that the exporters had been selling dollars on a large scale out of fear of further devaluation.
Moreover, the recent reforms introduced by the State Bank of Pakistan (SBP) aim to consolidate and transform various types of exchange companies into a single category with a well-defined mandate and higher capital requirements.
These reforms also encourage leading banks to establish wholly owned exchange companies to cater to the legitimate foreign exchange needs of the general public.
It is pertinent to note that the Monetary Policy Committee (MPC) of the State Bank of Pakistan (SBP) in its meeting held yesterday, decided to keep the policy rate unchanged at 22%.
The decision came in contrast with the market expectations wherein the majority of market participants were in consensus on a rate hike by 100-200bps.
Moreover, the current account deficit for August 2023 shrank by 79.35% MoM to $160 million compared to the deficit of $775m in July 2023. This occurred despite the removal of restrictions on letters of credit (LCs).
During the week PKR appreciated by 6.1 rupees or 2.05% compared to the previous week's closing of 302.95.
In comparison to major currencies, PKR gained 3.51 rupees against the Euro, closing at 316.38 compared to the previous value of 319.89.
The British Pound became cheaper by 3.18 rupees closing at 368.939 compared to 372.12 from a day ago.
The Swiss franc saw losses of 2.06 rupees, closing at 331.34 compared to 333.39 from the previous session.
Against the Japanese Yen, PKR gained 1.43 paisa, closing at 2.01 versus 2.02 a day ago.
The Chinese Yuan lost 13.54 paisa, closing at 40.82 against 40.95 from the previous session.
The Saudi Riyal decreased in value by 29.99 paisa from 81.12 a day ago to 80.82.
The U.A.E Dirham closed at 79.14 with a loss of 29.69 paisa from its values of 79.44 a day ago.
During the current financial year, PKR has depreciated against the Dollar by 10.86 rupees or 3.66%. While the current calendar year has seen PKR depreciate by 70.42 rupees or 23.72%.
In the Money Market, the benchmark 6 Month-Karachi Interbank Bid and Offer rates decreased by 159 bps to 22.84% and 23.09%.
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Posted on: 2023-09-15T16:55:24+05:00