Rupee weakens by 0.26% against the US dollar
Pakistani currency closed the day at Rs166.39 against the greenback in the inter-bank market
- The rupee lost around 2% against the US dollar in August 2021.
- Day closes at Rs166.39 due to strong demand for the dollar because of rising imports.
- The outlook remains optimistic as the rupee is expected to either consolidate or appreciate going forward, say AHL Head of Research Tahir Abbas.
KARACHI: The rupee continued to lose its ground against the US dollar for the second consecutive session in the inter-bank market on Tuesday, depreciating by 0.26% to close the day’s trade at Rs166.39.
The local currency closed at Rs165.96 in the inter-bank market on Monday.
The demand for dollars continues to be strong due to pressure from importers on the back of a strong economic recovery, pushing the domestic currency lower.
Cumulatively, the currency lost around 2% against the greenback, during the month of August. Meanwhile, it depreciated around 5% since the start of the fiscal year 2021-22 (July-August).
Speaking to Geo.tv, Arif Habib Limited (AHL) Head of Research Tahir Abbas said that Pakistan’s economy is now moving towards a growth phase. “However, an increase in imports and dismal current account numbers created pressure on the currency.”
The analyst added that keeping in view the real effective exchange rate (REER) — which is currently around 98 points — the rupee will consolidate.
Shedding light on the impact of the IMF programme, Abbas said: “If the IMF programme is resumed it will provide support to the local currency and the rupee will then appreciate.”
“Going forward, the outlook remains optimistic as the currency is expected to consolidate.”