Business

Rupee’s woeful ride continues, depreciates to settle at 223.66 against dollar

Published

2 years ago

Farwa

Rupee value has cumulatively decreased by 1.01% in past seven working days.
Local unit settles at Rs223.66 against the dollar in interbank market today.
Analysts say demand for imports is strong which is also increasing the parity as well.

KARACHI: Pakistan’s rupee continued to sustain losses against the US dollar for the seventh successive session, settling with a depreciation of 0.22% in the interbank on Monday, as investors remained concerned over the ninth review of Pakistan’s economy by the International Monetary Fund (IMF).

The currency lost 0.22% (or Re0.49) to close at Rs223.66 against the US dollar in the interbank market compared to Friday’s close of Rs223.17.

Meanwhile, in the open market, it settled at Rs231 losing Rs1.5 against the greenback compared to Friday’s rate of Rs229.5.

Analysts believe that the following issues have resulted in the rupee sliding, these include:

Uncertainty over the ninth review by IMF
Growing risk of defaulting on its obligations to repay foreign debt despite Finance Minister Ishaq Dar’s reassurance
Absence of a timeframe regarding incoming financing from Saudi Arabia and China

The rupee has cumulatively decreased by 1.01% (or Rs2.24) in the past seven working days, compared to the November 10 close at Rs221.42, according to the State Bank of Pakistan’s data.

Speaking to Geo.tv, Pakistan-Kuwait Head of Research Samiullah Tariq said demand is higher than supply, and US interest rates have increased which has dried up liquidity.

Therefore, the demand for imports is strong which is also increasing the parity as well.

Globally, the US dollar was firmly higher against major currencies on Monday, as rising COVID-19 cases in China led to new restrictions and weighed on global investor sentiment.

The dollar was up 0.5% against Japan’s yen at 141.07, its highest since November 11. Meanwhile, the euro was 0.62% lower against the greenback at $1.026.

The dollar index, which tracks the currency against major peers, has slid more than 6% from a 20-year high in October. Last month, a fall in the US inflation rate has driven bets that the US Federal Reserve will slow down its interest rate hikes.

Business

E&P Companies Will Invest $5 Billion in Pakistan’s Petroleum Industry

Published

18 hours ago

Farwa

Over the next three years, local and foreign companies involved in Pakistan’s oil and gas exploration and production sector have shown a strong desire to invest more than $5 billion in the nation’s energy sector.

Recent changes to the Petroleum Policy and the implementation of an exclusive tight gas policy, which provide better incentives and a more investor-friendly regulatory framework, are credited with the increase in investor confidence.

These strategic changes are expected to boost domestic energy production, open up new avenues for growth, and draw large amounts of both domestic and foreign investment.

Business

With inflation slowing, the SBP is anticipated to lower the policy rate for the eighth time in a row.

Published

19 hours ago

Farwa

Businesspeople anticipate another reduction in the policy rate when the State Bank of Pakistan’s (SBP) Monetary Policy Committee (MPC) releases the updated rate.

The interest rate for the upcoming two months will be announced by the central bank. It is still unclear if the rate will stay the same or be lowered to reflect stakeholder expectations.

According to experts, the policy rate will be lowered in order to further boost the nation’s economic sector.

Interest rates may be lowered for the seventh time in a row if the inflation rate declines significantly more than anticipated.

In its last six sessions, the MPC had cut the policy rate by 10 percent. In January 2025, it decreased the rate by one percent to 12pc.

12PC POLICY RATE

In January, the State Bank of Pakistan (SBP) announced cut in key policy rate by 100 basis points (bps) to 12 percent from 13pc in line with expectations of the business community.

The policy rate, which had been at 22 percent since June 2024, was slashed by 1,000 basis points to 12 percent.

The SBP governor said the decision was taken with careful consideration. “Although inflation is expected to decline next month (February), core inflation remains a pressing concern,” he stated.

Ahmed highlighted strong remittance inflows and robust export growth as key factors supporting the current account.