PKR’s sudden gains leave speculators baffled

September 16, 2021 (MLN): Pakistani rupee (PKR) snapped a 5-day losing streak against USD in the interbank market as the currency closed the day's trade at PKR 168, appreciating by 94 paisa, against yesterday's closing of PKR 169.12 per USD.

PKR broke its recent downtrend in the early trading session Thursday, managed to gain Rs1.13 against the US dollar.

According to Ali Khizar, Economist, "Dr. Murtaza Syed, Deputy Governor State Bank of Pakistan already warned the speculators in the forex market that SBP will not allow speculations."

Since SBP has more reserves, speculators will lose once currency changes direction, he added.

The Rupee saw moderate volatility in today’s session and traded in a range of 1.15 rupees per USD showing an intraday high bid of 168.70 and an intraday Low offer of 167.55.

Within the Open Market, PKR was traded at 168.50/169.50 per USD.

The domestic unit has depreciated by 6.32% or PKR 10.63 in the fiscal year-to-date against the USD. Similarly, the rupee has weakened by 4.96% or PKR 8.34 in CY21, with the month-to-date (MTD) position showing a decline of 1.07%, as per data compiled by Mettis Global.

Meanwhile, the currency gained 1.6 rupees against the Pound Sterling as the day's closing quote stood at PKR 232.36 per GBP, while the previous session closed at PKR 234.01 per GBP.

Similarly, PKR's value strengthened by 2 rupees against EUR which closed at PKR 198.03 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.34 billion for 1 day at 7.22 percent.

The overnight repo rate towards the close of the session was 7.00/7.20 percent, whereas the 1-week rate was 7.05/7.15 percent.

Copyright Mettis Link News