The rupee continues its steady ascent against the US dollar, with the local currency knocking down the greenback by Rs2.15 in interbank trading.
According to statistics provided by currency dealers on Friday, the rupee rose by Rs2.15 in early trade while the US dollar fell to Rs224 by 10 am in interbank dealing.
The dollar closed yesterday at Rs226.15. The rupee recovered more in the interbank market.
The rupee dropped to its lowest level versus the dollar on July 28, closing at 239.94, after two weeks of being smashed by the US dollar. It then began to recover on Friday and has been gaining since then.
Following the IMF’s announcement that Pakistan has completed the last previous action required by the Fund to release the seventh and eighth reviews, the market is demonstrating confidence in the rupee. Pakistan is eagerly awaiting the IMF’s $1 billion tranche.
Apart from that, Pakistan’s import bill fell in July and is expected to fall further this month, providing the rupee with much-needed breathing room as it continues to lose ground versus the US dollar.
The Pakistan Bureau of Statistics (PBS) said on Tuesday that the import bill fell 12.81 percent to $4.86 billion in July from $5.57 billion the previous year. The import bill decreased by 38.31 percent month over month.
The State Bank also helped to keep the dollar in check, issuing a joint statement with the Ministry of Finance on Sunday indicating that there was no risk of default and that the country’s funding needs would be more than covered in the current fiscal year.
The market has reacted positively and has begun to place faith in the rupee.
