Karachi, April 2, 2024 – The Pakistani Rupee exhibited resilience against the US dollar on Tuesday, gaining PKR 0.10 in the interbank foreign exchange market.
The rupee closed at PKR 277.84 to the dollar, marking a positive shift from the previous day’s closing of PKR 277.94.
Analysts in the currency market attribute this upward trend in the rupee’s value to reports of an improvement in exports, as revealed by the latest official data. The Pakistan Bureau of Statistics (PBS) reported a notable surge in exports, showing a growth rate of 9 percent during the first nine months (July – March) of the fiscal year 2023-24. Exports reached $22.91 billion during this period, compared to $21.04 billion in the corresponding months of the previous fiscal year.
Moreover, the trade deficit of the country witnessed a significant reduction of 25 percent during the same period. The trade deficit for the first nine months of the current fiscal year stood at $17.03 billion, down from $22.69 billion in the corresponding months of the previous fiscal year. This reduction in the trade deficit was primarily attributed to a decrease in the import bill, which fell by 8.65 percent to $39.94 billion during July – March 2023-24, compared to $43.72 billion in the same period of the previous fiscal year.
Currency experts noted the remarkable resilience of the local unit against the greenback, despite the reopening of the currency market after the weekly holidays. They suggest that the upward trajectory of the rupee can be attributed to several factors that underscore Pakistan’s improving economic landscape.
One significant factor contributing to the rupee’s strength is the surge in remittances and export receipts, which have substantially bolstered the nation’s fiscal health. Pakistan recorded a current account surplus of $128 million in February 2024, indicating robust performance driven by remittances and exports.
Recent data released by the State Bank of Pakistan (SBP) further validates the positive momentum in Pakistan’s economy. The Current Account Deficit (CAD) witnessed a remarkable reduction of 74 percent, plummeting to $999 million during the initial eight months of fiscal year 2023-24. This significant decrease reflects the effectiveness of policy interventions aimed at fortifying Pakistan’s fiscal position and mitigating external vulnerabilities.
According to the State Bank of Pakistan (SBP), Pakistan’s foreign exchange reserves recorded a notable increase of $37 million for the week ending March 22, 2024. The country’s reserves surged to $13.428 billion, up from $13.391 billion in the previous week. This uptick underscores positive developments in Pakistan’s balance of payments and reflects confidence in the nation’s economic prospects.
The strengthening of the rupee against the dollar bodes well for Pakistan’s economy, as it indicates improving trade dynamics and enhanced investor confidence. As Pakistan continues to focus on boosting exports and implementing prudent economic policies, analysts anticipate further stability and growth in the currency markets, contributing to the overall economic prosperity of the country.
