The Pakistani rupee on Monday exhibited a remarkable surge against the US Dollar, starting the day at 306 in the inter-bank market.
At noon, the currency displayed strong bullish tendencies, reaching as high as 300.75, marking an impressive gain of approximately Rs. 2 against the US Dollar. This rise coincided with open market rates climbing back into the 290 range for the first time since May 2023.
Later in the day, between 1:30 PM and 2:30 PM, the interbank rate eased to the 301 level before stabilizing for the remainder of the trading day.
Since the caretaker government assumed power, the Pakistani Rupee has appreciated by Rs. 11.82 against the US Dollar.
Compared to the 338-335 range observed on Monday, open market rates at various currency exchange counters stood at 297-299 today. This represents a substantial recovery of approximately Rs. 38 against the US Dollar since September 4.
By the close of the trading day, the Pakistani Rupee had appreciated by 0.59 percent, closing at 301.16, with a gain of Rs. 1.79 against the US Dollar.
During September, there has been a significant reduction in the gap between interbank and open market rates, shrinking by roughly Rs. 38. Starting from 337 reported the previous Monday, rates have fluctuated, briefly touching 299 today. Traders have reported a convergence of sellers and exporters eager to capitalize on the exchange rate before it settles, likely within the range of 294-302 for the remainder of the week. However, some uncertainty remains, which could push the Rupee below the 300 mark once again.
It’s worth noting that the central bank has been purchasing dollars from the interbank market.
Notably, the Rupee has depreciated by nearly Rs. 81 since January 2023 and over Rs. 128 against the US Dollar since April 2022. Today’s exchange rate movements indicate a gain of over Rs. 1.7 for the Pakistani Rupee against the US Dollar.
This resurgence of the Pakistani Rupee can be attributed to the government’s recent measures to curb the illegal trade of dollars through channels like Peshawar. These actions have allowed the Rupee to correct itself by over Rs. 35, in line with the International Monetary Fund’s 1.25 percent cap on the PKR/USD exchange rate.
In the past week, the federal government, in collaboration with state agencies, has initiated a substantial crackdown against black market dealers. This has contributed to boosting the valuation of the Pakistani Rupee. In recent days, numerous exporters have been seen exchanging dollars in bulk. If this momentum continues, the market may witness another correction of around Rs. 10 in the coming days or weeks.
Furthermore, in today’s interbank currency market, the Pakistani Rupee strengthened against other major currencies. It gained one paisa against the Australian Dollar (AUD), 38 paisas against the Canadian Dollar (CAD), Rs. 1.32 against the British Pound (GBP), and Rs. 1.46 against the Euro (EUR). Additionally, it appreciated by 47 paisas against the Saudi Riyal (SAR) and 49 paisas against the UAE Dirham (AED).