Daily Times

Pakistani rupee continued its winning streak against the US dollar for the second day in a row and recovered 40 paisa (+0.23 percent). The State Bank of Pakistan said on Wednesday that the dollar opened at Rs176.63 in the interbank market and closed at Rs176.23. The rupee witnessed a trading range of 25 paisa during the session, showing the intraday high bid of 176.25 and low offer of 176. Within the open market, the rupee was traded at 178.50/179.50 per dollar.

The dollar suffered globally as the benchmark 10-year US Treasury bond yield erased its daily gains after falling 1.755 percent on Tuesday. Resultantly , the US Dollar Index also lost its traction. Overall Pakistan rupee has gained 44 paisa against the US dollar during the last three day, while it has depreciated by 28 paisa during the current year 2022. The local unit has depreciated by Rs18.80 during the ongoing fiscal year 2021-22.

According to experts, the rupee’s stabilisation is the result of the apt measures taken by the central bank to improve the transparency in the foreign exchange market. Recently, SBP has amended foreign exchange regulations requiring exporters to bring export proceeds within a maximum period of 120 days from date of shipment. Earlier the exporters were required to bring their export proceeds within a maximum period of 180 days. This move also brings Pakistan’s regulations closer to international best practices.

According to currency experts, the approval of the State Bank of Pakistan (SBP) Amendment Bill 2021 by the National Assembly’s Standing Committee on Finance and Revenue also strengthened the local unit as the step will pave the way for the revival of the International Monetary Fund (IMF) programme.

They were of the view that the US dollar may face a further depreciation in the coming days if all goes well with regards to the IMF programme revival. They said the greenback is overvalued against the local currency. However, they warned that rising commodity prices in the international market threaten the rupee’s stability, as Pakistan’s import bill may increase and that will put pressure on the rupee.