Karachi, November 29, 2023 – The Pakistani Rupee (PKR) witnessed a positive shift on Wednesday, appreciating by PKR 0.13 against the U.S. Dollar as the interbank foreign exchange market concluded its trading session.
The local currency concluded at PKR 285.39 against the dollar, a slight improvement from the previous day’s closing of PKR 285.52 in the interbank foreign exchange market.
Currency experts attribute this upward movement to positive sentiments surrounding the country’s economy. The surge gained momentum with the announcement of multibillion-dollar projects being signed between Pakistan and the United Arab Emirates (UAE). The collaboration between the two nations injected optimism into the currency market, contributing to the recovery of the rupee’s value. The positive sentiment emanating from substantial economic partnerships played a stabilizing role in bolstering the local currency.
Despite this recent positive development, experts remain cautious about the rupee’s future outlook. They anticipate ongoing pressure on the currency due to a decline in foreign exchange reserves. The State Bank of Pakistan (SBP) reported a weekly decrease of $217 million in its foreign exchange reserves, citing external debt payments as a contributing factor.
As of the week ending November 17, 2023, the SBP’s official reserves stand at $7.18 billion, marking a notable decrease from the $7.397 billion reported just a week earlier on November 10, 2023. This declining trend aligns with the country’s total foreign exchange reserves, which witnessed a decrease of $234 million. The total reserves settled at $12.302 billion by the week ending November 10, 2023, compared to the preceding week’s level of $12.536 billion.
Currency experts underscore that market-based exchange rates are influenced significantly by the determination of the rupee’s value. Fluctuations in market dynamics, coupled with external factors such as debt payments and import demands, contribute to the observed volatility in the exchange rate.
The overall economic landscape and global market conditions are expected to play a pivotal role in shaping the trajectory of the Pakistani Rupee in the upcoming days. Investors, businesses, and policymakers remain vigilant, closely monitoring these developments as they navigate the challenges posed by currency fluctuations, striving to uphold stability in the foreign exchange market.
