The rupee appreciated against the dollar in the interbank and open markets in recent weeks owing to the strong foreign inflows, while positive economic indicators also helped in appreciation of the currency, as per local media reports on Sunday.
The rupee closed at 155.28 against the greenback on Monday and closed at 155.06 on Friday. In the open market, the rupee gained 25 paise to close at 155.10 against the dollar. Currency dealers expect the rupee to rise further over the next week. He said that he has seen an increase in last few days.
After the current economic deficit, a positive economic outlook and stable reserves of the exchange have increased the strength of the rupee. He added that he expects the rupee to rise further in the coming days, and the next level is 154. 50.
The surged inflows have eliminated the supply of greenbacks in the market, which has benefited the local unit. The current week has seen positive progress on the economic front, with Moody improving the rating of five major banks, as well as upgrading Pakistan’s outlook from negative to stable.
Moody’s said the change in outlook stabilization is due to the expectation that the dynamics of payments will remain balanced, supported by policy adjustments and current flexibility.
The rating agency has said that such progress could reduce the risk of external threats, although foreign exchange reserve buffers remain low, and it will take the time to rebuild.
The Asian Development Bank has also approved a $ 1 billion emergency loan to support the budget. In addition, the country received $190 million from the settlement between Malik Riyadh and the British government in one week.
During the week ended November 29, the reserves held by the central bank increased by $431 million to $9.112 billion. The reason for the increase in the foreign exchange of the State Bank was the reduction of the central bank’s foreign exchange and forward liabilities.