Daily Times

The rupee continued advancing against the US dollar in the inter-bank market on Thursday and improved by 12 paisas (0.04 percent), surging for the 24th time in the last 26 sessions.

The State Bank of Pakistan (SBP) said in a tweet that the rupee opened at 280.10 against the dollar in the interbank market and closed at 279.98. Overall, the local unit improved by Rs1.04 against the greenback last week while it gained Rs6.67 during the previous nine weeks.

Similarly, the rupee improved by Rs8.31 during the current fiscal year 2023-24 and Rs1.88 in the current year. The rupee gained Rs3.31 against the US dollar in December, while it shed Rs3.69 against the US dollar in November after gaining Rs6.26 (+2.23 percent) against the greenback in the month of October. The currency surged more than 6 percent in September.

On the other hand, the local unit improved by 50 paisas against the greenback in the open market. The rupee was quoted at 279 for buying and 281 for selling against 279.5 for buying and 281.5 for selling in the previous session, according to data provided by different exchange companies. The rupee gained Rs3.50 against the greenback in December while it surged by 50 paisas against the greenback last week.

Meanwhile, Pakistan’s international bonds fell after the foreign ministry said it conducted strikes inside Iran, two days after Tehran said it had attacked the bases of a group within Pakistani territory. The 2026 bond suffered some of the biggest declines, dropping 1.2 cents to trade at 71.125 cents in the dollar, data from Tradeweb showed.

The SBP said a day earlier that Pakistan received a tranche of $705.6 million from the International Monetary Fund (IMF). The development came days after the IMF Executive Board completed the first review of the $3-billion Stand-By Arrangement. In another statement, the SBP said that the United Arab Emirates (UAE) confirmed rollover of its two deposits of $1 billion each placed with the State Bank of Pakistan for another one year, which were maturing in January 2024. In January 2023, the UAE agreed to roll over the existing loan of $2 billion and provide an additional loan of $1 billion.

The latest developments hold significance for Pakistan’s economic landscape as the country faces a low level of foreign exchange reserves amid repayments and low non-debt-creating dollar inflows. Foreign exchange reserves held by the SBP decreased by $66 million on week-on-week, clocking in at $8.15 billion as of January 5, data released last Thursday showed. Total liquid foreign reserves held by the country stood at $13.25 billion. Net foreign reserves held by commercial banks stood at $5.10 billion.