KARACHI: The Pakistani rupee on Fridayappreciated against the dollar after declining for four straightsessions amid inflows of workers’ remittances, dealers said.
The local unit gained 27 paisas to close atRs186.70 to the dollar from the previous day’s closing of Rs186.97 in theinterbank foreign exchange market.
The rupee recorded decline for the previousfour straight sessions during the outgoing week due to depleting forexreserves, political instability and volatile global commodity prices, thedealers added.
The local currency was provided with someshort-lived support during the previous week on account of an unprecedentedincrease in the key policy rate by the State Bank of Pakistan (SBP) coupledwith other measures to curb the import bill of the country.
The central bank also imposed 100 per centcash margins on 177 items in a bid to curb their imports, which helped easingpressure on the rupee and reducing trade and the current account deficits.Pakistan received the highest-ever monthlyremittances of $2.8 billion by the overseas workers.
The record increasepartially reduced the burden of the rising current account deficit whichreached $12 billion during the first eight months of fiscal year 2022.
The local currency hit the historic low ofRs188.18 on April 7, as the country faced the worst political crisis resultingin uncertain economic conditions.The country’s foreign exchange reservesclocked-in at $17.045 billion by the week ended April 16, 2022, State Bank ofPakistan (SBP).
The foreign exchange reserves of the country were at $17.028 billiona week ago.
The official foreign exchange reserves of theState Bank also improved by $36 million to $10.886 billion by the week endedApril 16, 2022 as compared with $10.85 billion a week ago.
The foreign exchange held by commercial banks,however, fell by $19 million to $6.157 billion by the week ended April 16, 2022as compared with $6.178 billion a week ago.
The ballooning current account deficit isanother reason for escalation in the dollar value.
Pakistan’s current accountdeficit ballooned to $12 billion during the first eight months (July-February)2021/22 against a surplus of $994 million in the corresponding months of thelast fiscal year.
The local currency remained under pressuresince the start of the current fiscal year. The rupee lost Rs29.16 or 18.50 percent from Rs157.54 to dollar on June 30, 2021 to the current level of Rs186.70.
At the open market, the buying and selling ofthe dollar was recorded at Rs186.9 and Rs188.5 at 3:45pm PST.
