Rupee Continues Gains Due To Improved Dollar Inflows, Optimism On IMF Deal

Rupee Continues Gains Due To Improved Dollar Inflows, Optimism On IMF Deal
The Pakistani Rupee continued an upward trend for the fourth straight trading session, amid improved dollar inflows and optimism on a deal with the IMF. The value of the rupee increased 0.59% against the US dollar on Friday, taking its gains during the past week to 2.5%.

In the interbank market, the rupee closed at 262.82 per dollar on Friday, stronger than the previous close of 264.38 per dollar. However, the domestic currency ended unchanged at 268 to the dollar in the open market.

Currency dealers believe that after the currency stabilisation and concrete developments on the IMF loan front, dollar inflows through formal channels had begun to improve. “Dollars are being sold in the market by exporters, while overseas Pakistani workers are transferring money home via authorised means. This help increased dollar supplies,” a currency dealer said.

The rise in the rupee also reflects some improvement in Pakistan's foreign exchange reserves. Anticipation on the IMF restarting its loan programme to Pakistan has also boosted investor sentiment.

A staff-level agreement between Pakistan and the IMF is expected to be reached next week, according to media reports.

Pakistan and the IMF are convening negotiations in a virtual conference wherein both parties have reportedly come very close to an agreement on the heavily indebted country's macroeconomic and fiscal framework for the ongoing fiscal year.