PKR appreciates for second day to 279.33 vs USD

KARACHI
Pakistani rupee appreciated against the US dollar for the second straight session in the inter-bank market and gained 17 paisas on Thursday.
The State Bank of Pakistan (SBP) said that the rupee opened at 279.50 against the dollar in the interbank market and closed at 279.33, with an uptick of 0.06 percent. Out of the last 49 sessions, the rupee has surged in 39 sessions and lowered in eight sessions, while it remained unchanged in two sessions.
The rupee has improved by Rs8.95 during the current fiscal year 2023-24. The local unit improved by Rs2.36 in January and Rs3.31 in December, while it shed Rs3.69 against the US dollar in November after gaining Rs6.26 (+2.23 percent) against the greenback in the month of October.
On the other hand, the local unit gained traction against the greenback in the open market. The rupee was quoted at 279.5 for buying and 282.3 for selling, according to data provided by different exchange companies. The rupee surged by Rs2 against the greenback in January while it gained Rs3.50 in December.
Fitch Ratings said earlier this week that the close outcome of Pakistan’s election and resulting near-term political uncertainty “may complicate” the country’s efforts to secure a new financing agreement with the International Monetary Fund (IMF). The ongoing Stand-By Arrangement (SBA) is scheduled to expire in March 2024.
In a related development, the rupee’s Real Effective Exchange Rate Index (REER) increased by 2.91 percent month-on-month in January 2023 to a provisional value of 101.7 from the revised value of 98.83 in December 2023.
According to data published by the SBP, the REER index has increased by 8.24 percent compared to January 2023.
Meanwhile, the country’s current account posted a deficit of $269 million in January 2024, in stark contrast to a surplus of $404 million recorded in December 2023, revealed data released by the central bank on Monday. The deficit came amid a minor month-on-month decrease in the country’s exports, but a significant increase in imports.
Meanwhile, the country’s remittances stood at $2.397 billion in January 2024, in comparison to $2.382 billion in December 2023, an increase of 1%.