The rupee continued to rally in the interbank market on Monday, gaining 87 paisas against the dollar in early trade.
The rupee, which had closed at 239.37 last week, was trading at 238.50 around 10 am, according to Mattis Global, a web-based financial data and analytics portal.
Meanwhile, according to the Forex Association of Pakistan (FAP), the PKR rose by Rs 7 against the dollar in the open market and was trading at Rs 240 around 10 am.
FAP Chairperson Malik Bustan said the government has tightened security at the border to prevent smuggling of greenbacks into Afghanistan, where the value of the dollar is high. Those involved in smuggling and speculators have suffered a major blow in the last two days … the flow of dollars in Afghanistan has stopped and the effect can be seen in the open market.
He said that he expects the rupee to strengthen in the interbank market as well.
‘Pressure on rupee will ease’
A day earlier, Finance Minister Miftah Ismail voiced optimism that the pressure on the rupee, which has seen a sharp drop against the dollar in recent weeks, would ease within the next two weeks.
The minister said that he will try to ensure that the dollars coming into the country on a daily basis are more than those leaving.
Ismail said efforts to reduce imports would bear fruit and the dollar would depreciate, adding that improvement would be seen in the next two weeks.
“But to be honest, no one knows the market. I can believe the fundamentals are in my favor but speculation, emotion plays a role as well.”
Apart from that, the State Bank of Pakistan (SBP) and the Ministry of Finance said in a joint statement that the rupee was “expected to appreciate fully” in line with a narrowing current account deficit and improved sentiment.
“Obviously, the rupee can temporarily overshoot as it has done recently. However, it tends to go both ways over time. We expect this pattern to continue in the near future. will set you up again.”
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