ISLAMABAD: The Pakistani rupee continued to march upwards against the US dollar amid improved market sentiment, trading near the 221 level in the inter-bank market on Wednesday.
At around 11:00 am, the rupee was being quoted at 221.49, an appreciation 1.15% against the greenback, during intra-day trading.
During the previous week, the rupee registered a substantial gain of 6.8% against the US dollar to close at 224.04 in the inter-bank.
The rupee closed stronger throughout the week, maintaining its momentum as Pakistan reported a narrower trade deficit and much lower import bill during July, taking pressure off the currency that had gotten a hammering at the hands of the dollar recently.
The improvement in market sentiments was driven after the International Monetary Fund (IMF) said that with the increase in petroleum development levy (PDL), Pakistan has completed the last prior action for the combined seventh and eighth review, adding that the board meeting is tentatively planned for late August once adequate financing assurances are confirmed.
Later, in an official statement, an official source in Abu Dhabi emphasised the UAE’s intention to invest $1 billion in Pakistani companies in various economic and investment sectors, taking Pakistan closer to meeting what the IMF calls a funding gap.
Market analysts expect further appreciation in the coming days, provided Pakistan gets its funding needs in order.
“Falling imports and likely resumption of IMF and other flows will bring the much-needed stability in Pak Rupee,” said Topline Securities in its ‘Pakistan Market Outlook – Mid Year Strategy 2022’.
“We now expect PKR to remain in the range of Rs 200-240 in FY23 where on average basis we expect PKR to settle at around Rs220 in FY23 against average USD rate of Rs178 in FY22,” it said.