Rupee gains 13 paisas in early trade

Rupee gains 13 paisas in early trade

KARACHI: The Pak Rupee made significant recovery on Monday morning and gain 13 paisas against dollar owing to improved economic indicators.

The dollar is being traded at Rs154.90 in early trade in interbank foreign exchange market. The foreign currency market was ended at Rs155.03 to the dollar on last Friday.

Currency experts said that the improved economic indicators and confidence of foreign lending agencies helped the rupee to gain against the greenback.

They said that the foreign exchange reserves of the country were improved despite repayments of foreign debt. The inflows of funds from IMF and other agencies showed confidence of foreign lending agencies on the improved economic indicators of the country.

The ministry of finance a day earlier issued a statement explaining the achievements of the present government on economic front.

With regard to the external sector, significant improvement has been witnessed. Overall, Current Account Deficit (CAD) shrunk by almost two-thirds (74 percent) in the Q1 FY 20 compared to the same period of FY 2019. CAD is projected to decline to 2.4 percent of GDP in FY20 (4.9 percent), which is lower than earlier IMF forecasts of 2.6 percent.

Total imports fell by 23 percent y-o-y in Q1 of FY2020, but imports of machinery and equipment were more resilient, rising about 2 percent y-o-y. Exports are showing some sign of recovery, up 2 percent y-o-y for the same period with 17 percent volume growth, mainly driven by food and textiles.

The finance ministry said the IMF report pointed out that transition to a market determined exchange rate has allowed the rupee to find its new equilibrium quickly, thereby, successfully correcting the ‘exchange rate overvaluation’ of the last 5 years.

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