Rupee strengthens to 285.75 against dollar
The rupee made a sharp recovery of 4.4 per cent against the US dollar in the interbank market on Friday, staging a remarkable recovery having lost almost 3pc of its value yesterday.
The PKR was trading at Rs285.75 per dollar around noon, gaining Rs13.18 from yesterday’s close of Rs298.93.
Forex Association of Pakistan (FAP) Chairperson Malik Bostan said the local currency had appreciated over hopes that the political situation would improve after the Supreme Court decision terming Imran Khan’s arrest unlawful.
He said the court decision could end the ongoing political unrest, paving the way for the government and the opposition to reach a consensus through dialogue.
Yesterday, the rupee had fallen 2.9pc, or Rs8.71, from its previous close of Rs290.22.
After yesterday’s steep devaluation, there was a consensus in the financial market that the fall of the rupee against the dollar was not solely the direct outcome of the deteriorating political situation. Instead, it was widely believed that large payments from Pakistan allowed the dollar to gain strength.
Meanwhile, the foreign exchange reserves of the State Bank of Pakistan (SBP) declined by $74m to $4.38bn for the week ending on May 5, the central bank reported on Thursday.
The total reserves of the country were down by $53m to $9.99bn. Commercial banks’ reserves, however, recorded a paltry rise of $21m to $5.6bn during the week.
More to follow.