The Pakistani Rupee witnessed a marginal depreciation of seven paisas against the US Dollar in early trade on Monday.
The exchange rate in the interbank foreign exchange market stood at Rs138.30 to the dollar, reflecting increased demand on the first day of the week and the government’s announcement of a public holiday on February 5.
On the preceding Friday, the exchange rate had concluded at Rs138.23 to the dollar, indicating a slight fluctuation that financial experts attribute to a combination of heightened demand and the government-declared public holiday.
Market analysts revealed that the interbank foreign exchange market opened with an increased demand, a trend attributed to the closure of the market for the past two consecutive weeks. The demand was further boosted by the government’s decision to observe February 5 as a public holiday in solidarity with Kashmir, amplifying financial activities on the preceding Monday.
The recent appreciation of the Pakistani Rupee against the US Dollar during the previous week was driven by significant foreign inflows totaling $2 billion from Saudi Arabia and the United Arab Emirates. This influx of foreign capital contributed to the Rupee’s upward trajectory, providing a momentary respite.
Currency experts are optimistic about the future, anticipating that the local currency will regain strength in the coming days. The prospects of substantial investments from Saudi Arabia are cited as a key factor influencing this positive outlook. Notably, Saudi Arabia’s Crown Prince was scheduled to visit Pakistan on February 16, 2019, with expectations that this visit would further bolster economic ties between the two nations.
The Crown Prince’s visit is anticipated to bring about increased financial cooperation and potential investments, instilling confidence in the Pakistani economy. If these expectations materialize, the Rupee could experience a boost, paving the way for a more robust performance against major currencies.
Market participants and investors are closely monitoring developments, especially as global economic dynamics and geopolitical events continue to play a significant role in shaping currency movements. The interplay of economic policies, foreign investments, and geopolitical events will likely be crucial determinants of the Rupee’s future trajectory against the US Dollar and other major currencies.
As the week unfolds, financial markets will be keenly observing any further developments in the currency exchange rates, considering both domestic and international factors that could influence the Pakistani Rupee’s performance in the foreign exchange market.
