Rupee Rises Slightly Against US Dollar to End Election Week

The Pakistani rupee gained slightly against the US Dollar today after opening trade at 280 in the interbank market. It was stable against the greenback, rising as high as 279 against the $ during intraday trade today. Notably, other market indicators (PSX, dollar bonds, and public sentiment) fell considerably. The interbank rate hovered between 279 and 280 before closing at the same level for the remainder of the day. Open market rates across multiple currency counters were in the 279-281 range today. At close, the PKR appreciated by 0.02 percent to close at 279.28 after gaining six paisas against the dollar today. The rupee closed in the green second day in a row today. On a fiscal year-to-date basis, it has so far appreciated by 2.38 percent. Overall, the rupee is down nearly Rs. 60 since January 2023. Since April 2022, it is down over Rs. 107 against the greenback. As per the exchange rate movements seen today, the PKR gained six paisas against the dollar today. In a key development, Moody’s Investors Services (Moody’s) stated that a timely announcement of the results, leading to a smooth formation of a new government will reduce policy and political uncertainty. This is crucial for the country that is facing very challenging macroeconomic conditions, with a fragile balance of payments, weak growth, and high inflation. Meanwhile, a trader said the rupee is poised to take hits in the coming days due to uncertainty created as a result of the February 8 General Elections. Reports of rigging have greatly undermined the system and hurt market sentiment. Expect falls starting Monday, he added. The PKR was green against most of the other major currencies in the interbank market today. It lost 26 paisas against the Euro (EUR) and 37 paisas against the Canadian Dollar (CAD). Conversely, it gained one paisa against the Saudi Riyal (SAR), one paisa against the UAE Dirham (AED), 20 paisas against the British Pound (GBP), and 46 paisas against the Australian Dollar (AUD)  in today’s interbank currency market.