Karachi, August 23, 2024 – The Pakistani rupee made a notable recovery of 17 paisas against the US dollar on Friday, ending the trading day at PKR 278.50 in the interbank foreign exchange market.
This uptick follows a period of consistent pressure and depreciation against the greenback over the past two days.
The recent recovery comes amid heightened demand for foreign currency driven by import needs. Despite this demand, the rupee’s resilience can be attributed to recent improvements in the country’s foreign exchange reserves.
According to the latest data released by the State Bank of Pakistan (SBP), Pakistan’s foreign exchange reserves saw a modest increase, reaching $14.67 billion as of August 16, 2024. This reflects a gain of $22 million from the previous week’s reserves, which were recorded at $14.645 billion on August 9, 2024. The uptick in reserves is largely credited to improved export receipts and robust remittances from overseas Pakistanis, both of which have played a significant role in stabilizing the nation’s balance of payments.
Currency analysts noted that the recent rebound in the rupee’s value signals a temporary alleviation of pressures exerted by the high demand for dollars. The increase in reserves has provided a cushion for the rupee, though experts caution that future stability remains contingent on several factors.
Looking ahead, analysts anticipate potential pressure on the rupee due to upcoming large external repayments by the government. These repayments could introduce renewed volatility in the foreign exchange market, affecting the rupee’s performance in the near term.
Despite the current positive shift, the currency market remains vigilant as the situation evolves. The balance between import demands and foreign exchange reserves will be crucial in determining the rupee’s trajectory in the coming days.
In summary, while the Pakistani rupee has gained some ground against the dollar today, the medium-term outlook suggests that the currency may face further challenges as the government navigates its external financial obligations.
