Daily Times

Pakistani rupee continued strengthening against the US dollar in the inter-bank market for the sixth straight session on Wednesday and improved by 12 paisas (0.04 percent).

The State Bank of Pakistan (SBP) said in a tweet that the rupee opened at 279.79 against the dollar in the interbank market and closed at 279.67. Overall, the local unit improved by Rs0.46 against the greenback last week while it gained Rs7.13 during the previous ten weeks, which it closed on a positive note. The rupee has surged in 28 out of the last 30 sessions.

Similarly, the rupee improved by Rs8.62 during the current fiscal year 2023-24 and Rs2.19 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 advanced against the greenback in the open market. The rupee was quoted at 279.1 for buying and 281.1 for selling against 279.3 for buying and 281.3 for selling, 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. The rupee has gained Rs2 against the greenback in the previous four weeks while it gained Rs3.50 in December.

Meanwhile, the SBP decided to revamp the foreign exchange trading system and introduce a Centralized Foreign Exchange (FX) Trading Platform called “FX Matching” for the interbank FX market to bring more transparency to the interbank market. Effective from January 29, 2024, it will be mandatory for ADs to use ‘FX Matching’ or FXT dealing for executing outright interbank FX transactions. Analysts said this centralized trading platform will reduce the volatility in the interbank market and support a free and fair FX trading system.

Moreover, the meeting of the Monetary Policy Committee (MPC) of the SBP will be held on Monday i.e. January 29 to decide about the policy rate.

The recent stability of the local currency arises from improved macroeconomic conditions in the form of increased liquidity in the foreign exchange market due to tighter enforcement of regulations, a shrinking money supply, a balance of payments surplus on account of low import demand, and a moratorium on Chinese debt repayments.