KARACHI: The Pakistani rupee remained flat against the dollar on Tuesday due to the lack of investors’ participation in the market on the back of political and economic uncertainty, dealers said.
The exchange rate gained 1 paisa against the dollar to reach Rs221.65 from the previous day’s closing of Rs221.66 in the interbank foreign exchange market.
Currency experts said that the rupee remained flat despite the finance minister’s statement of Pakistan securing roughly $13 billion in additional financial support from China and Saudi Arabia, as the political noise dampened the investors’ sentiments.
The political environment heated up following the reports of Pakistan Tehreek-e-Insaf (PTI) workers closing down the entrances to the capital, they added.
The government has decided to limit foreign currency bought per person and limited outflow to $50,000 per year with the aim of lowering the open market’s speculatively high dollar value.
However, the foreign exchange reserves of the State Bank of Pakistan (SBP) recorded an increase of $1.5 billion during last week due to the arrival of inflows from Asian Development Bank (ADB).
The central bank’s reserves clocked-in at $8.91 billion during the week ended on October 28, compared with $ 7.44 billion on October 21, 2022. This increase is attributed to the receipt of $1.5 billion from the ADB.
The net foreign exchange reserves held by the commercial banks also witnessed an increase of $44 million to reach $5.76 billion during the week ended October 28. The total liquid foreign reserves held by the country stood at $14.67 billion as of October 28, up from $13.162 billion a week earlier.
The country’s services trade deficit slashed by over 26 per cent to 647.4 million during the first quarter of the fiscal year 2023, as against $877.3 million recorded in the same period last fiscal.
The services exports increased 4.63 per cent to $1.695 billion, and imports were down 6.2 per cent to $2.34 billion, depicting a deficit of $647.4 million.
The international oil prices slipped on Tuesday as recession concerns and worsening Covid-19 outbreaks in top crude importer China heightened fears of lower fuel demand.
Brent crude fell 84 cents, or 0.9 per cent, to $97.08/barrel while the US West Texas Intermediate (WTI) crude fell 96 cents, or 1 per cent, to $90.83/barrel.
The local currency remained under pressure since the start of the current fiscal year. The rupee lost Rs16.80 or 8.20 per cent from Rs204.85 to dollar on June 30, 2022 to the current level of Rs221.65.
At the open market, the buying and selling of the dollar was recorded at Rs225.5 and Rs227.75 at 5:30pm PST.
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