KARACHI: The upsurge of the rupee against the US dollar continued on Tuesday with the local currency gaining 0.16% compared to the previous close on the back of an improved supply of hard currency and positive investor sentiments.
The Pakistani rupee settled at Rs176.43 against the greenback in the inter-bank market today.
A currency dealer said: “Sentiment is positive for the rupee ahead of the executive board meeting of the International Monetary Fund (IMF) on February 2 (tomorrow)."
Traders are hopeful that the IMF board will clear the sixth review as the country has met all the conditions needed to get the $1 billion loan tranche from the IMF under the Extended Fund Facility.
After posting a fresh gain of 0.16%, the Pakistani rupee has depreciated by 11.99% (or Rs18.89) since the start of the current fiscal year on July 1, 2021, data released by the central bank revealed.
The rupee has maintained the downtrend for the past nine months. It has lost 15.86% (or Rs24.16) to date, compared to the record high of Rs152.27 recorded in May 2021.
Currency dealers believe the local unit would rally in the ongoing week on growing investors' optimism about Pakistan’s economic prospects after the government fulfilled all requirements for the resumption of the IMF loan programme.
A trader added: “For the next couple of weeks the rupee may rally supported by the IMF approval and the expected $1 billion inflows from the issuance of dollar-denominated Sukuk."
However, some traders see cautious optimism in the market on fears of increasing inflationary pressures and further fragility in the current account amid a fresh spike in global commodity prices.