Rupee Ends Firmer at PKR 277.73 Against Dollar

Rupee Ends Firmer at PKR 277.73 Against Dollar

Karachi, October 23, 2024 – The Pakistani rupee exhibited resilience on Wednesday, closing firmer at PKR 277.73 against the US dollar in the interbank foreign exchange market. This marks a slight gain from the previous day’s closing rate of PKR 277.74, reflecting a stabilizing trend in the currency.

Currency experts attributed the rupee’s performance to several positive economic indicators and an influx of foreign investments, which bolstered market confidence. Analysts expressed optimism regarding the rupee’s near-term outlook, highlighting the gradual recovery of Pakistan’s foreign exchange reserves as a critical factor behind this trend.

According to the latest data from the State Bank of Pakistan (SBP), the country’s net foreign reserves increased by $64 million during the week ending October 10, 2024, bringing the total reserves to $16.111 billion, up from $16.047 billion the prior week. Notably, the SBP’s own holdings saw a significant rise of $215 million, climbing from $10.808 billion to $11.023 billion. This bolstered reserve position is viewed as a positive sign for Pakistan’s economic stability.

A stronger reserve base not only serves as a financial cushion against external economic challenges but also reduces reliance on foreign borrowing. Financial analysts welcomed this upward trend, noting that it will likely alleviate the downward pressure on the rupee. “This increase in reserves is a step towards stabilizing the rupee,” commented a senior financial analyst. “With stronger reserves, Pakistan is better equipped to manage external economic shocks, enhancing market confidence in the rupee’s future.”

In addition to improved reserves, factors such as a strengthening trade balance and a narrowing current account deficit have also contributed to the rupee’s stability. Recent data indicates that both deficits have contracted, minimizing the demand for foreign currency to cover international payments.

Moreover, steady remittance inflows from overseas Pakistani workers and a notable uptick in export growth further support the rupee’s position. While short-term fluctuations are anticipated, the combination of these favorable factors paints a positive outlook for the rupee’s performance in the coming months.

Overall, the recent developments indicate a strengthening economic environment that could bolster the rupee’s resilience against the dollar, fostering confidence among investors and stakeholders in Pakistan’s financial landscape.