KARACHI – The Pakistani Rupee saw a slight recovery on Tuesday, appreciating by two paisas against the US Dollar despite increased demand for imports and corporate payments. The rupee closed at Rs160.37 per dollar in the interbank foreign exchange market, improving from the previous day’s closing rate of Rs160.39.
Currency dealers noted that this recovery comes after two consecutive days of depreciation. The local currency’s slight gain is attributed to a balanced supply of foreign currency, which offset the higher demand from importers and corporate entities.
“The market observed a robust demand for the US Dollar due to import and corporate payment obligations,” said a currency dealer. “However, the supply of foreign currency was sufficient to support the rupee, leading to its modest appreciation.”
The interbank market is a critical venue where banks trade foreign currencies with each other, and it is closely monitored by both traders and policymakers for signs of currency stability or volatility. In recent days, the rupee had been under pressure due to increased demand for the dollar, but the latest data suggests a potential turnaround.
Dealers are optimistic about the rupee’s prospects in the coming days. They expect the local currency to strengthen further, buoyed by anticipated inflows from workers’ remittances and export receipts.
“Inflows of workers’ remittances have been a significant source of support for the rupee,” said another dealer. “Similarly, export receipts are expected to contribute positively, providing a much-needed boost to the local currency.”
Remittances from Pakistani workers abroad have been a critical lifeline for the country’s economy, providing a steady stream of foreign exchange that helps to stabilize the rupee. Likewise, export earnings contribute to the foreign exchange reserves, which are vital for meeting external obligations and supporting the local currency.
The slight recovery of the rupee amidst high demand for the dollar underscores the complex dynamics of Pakistan’s foreign exchange market, where various factors such as demand and supply, remittances, and export receipts play crucial roles.
Market analysts and economic experts will continue to monitor these developments closely. The interplay between demand pressures from imports and corporate payments, and the supply side bolstered by remittances and export earnings, will determine the rupee’s trajectory in the near term.
As the market looks ahead, the expectation of sustained inflows provides a silver lining, suggesting that the rupee may continue to find support and possibly strengthen further against the dollar.
In summary, the Pakistani Rupee’s slight gain against the dollar on Tuesday, closing at Rs160.37, is a positive sign amidst high demand for foreign currency, with future gains anticipated due to remittances and export receipts.