Rupee recovers against dollar on Saudi support deal

Rupee recovers against dollar on Saudi support deal

KARACHI: The Pak Rupee (PKR) recovers 48 against the dollar on Tuesday after positive sentiments prevailing in the market over the signing of the Saudi packages for Pakistan.

The rupee ended Rs175.72 to the dollar from the previous day’s closing of Rs176.20 in the interbank foreign exchange market.

A day earlier, the State Bank of Pakistan (SBP) and Saudi Fund for Development (SFD) signed a deposit agreement. Under the deposit agreement, the SFD would place a deposit of $3 billion with the SBP. The deposit amount under the agreement would become part of SBP’s foreign exchange reserves.

The rupee hit an all-time low of Rs176.20 on November 29, 2021.

Currency experts said that the market had witnessed high dollar demand for import and corporate payments. However, the reports of the Saudi support package helped the rupee to make some recovery.

In order to support the local currency, the SBP on November 19, 2021, decided to tighten the monetary policy stance. The SBP enhanced the key policy rate by 150 basis points to 8.75 per cent.

Although, the rupee recovered some value following the policy decision but the dollar demand persist for external payment and rupee plunged to the historic low.

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