Rupee Edges Higher Against US Dollar as Election Week Draws to a Close.
Today, the Pakistani rupee saw a slight gain against the US Dollar in the interbank market, opening at 280. It remained stable throughout the day, reaching a high of 279 against the dollar during intraday trade. However, other market indicators such as PSX, dollar bonds, and public sentiment experienced considerable declines.
The interbank rate fluctuated between 279 and 280 before settling at the same level for the remainder of the day. In the open market, rates ranged between 279 and 281 across various currency counters. By the day’s close, the PKR had appreciated by 0.02 percent, closing at 279.28 after gaining six paisas against the dollar. This marks the second consecutive day of the rupee closing in the green, with a year-to-date appreciation of 2.38 percent.
READ MORE: Pakistan’s Dollar Bonds Plummet After Election Outcome.
Despite these recent gains, the rupee has faced significant depreciation since January 2023, totaling nearly Rs. 60, and over Rs. 107 since April 2022 against the greenback. Today’s exchange rate movements resulted in a six paisa gain against the dollar. Moody’s Investors Services highlighted the importance of a timely announcement of election results for reducing policy and political uncertainty, crucial for a country grappling with challenging macroeconomic conditions including a fragile balance of payments, weak growth, and high inflation.
However, market sentiment remains uncertain due to reports of rigging in the February 8 General Elections, which have undermined confidence. A trader predicted potential falls starting Monday due to this uncertainty. Despite this, the PKR showed gains against most other major currencies in the interbank market today, except for losing 26 paisas against the Euro and 37 paisas against the Canadian Dollar. Conversely, it gained one paisa against the Saudi Riyal, one paisa against the UAE Dirham, 20 paisas against the British Pound, and 46 paisas against the Australian Dollar.
