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Rupee remains stable versus US dollar

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2 years ago

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  • Rupee settles at 223.95 against US dollar in interbank market.
  • Local unit lost value in last few sessions but remained within 223 level.
  • PBC says expecting rupee to defy gravity is “unrealistic”.

KARACHI: The Pakistan’s rupee fell marginally against the US dollar on Monday, depreciating Re0.01 in the interbank market.

The rupee settled at 223.95 against the US dollar compared to its Friday close of 223.94 in the interbank market, according to the State Bank of Pakistan (SBP).

The rupee lost value in the last few sessions but remained within the 223 level as restrictions imposed over import payments, opening of letters of credit, and foreign-currency carrying limits on travellers meant the currency stayed administratively under control.

Analysts also believe it was a result of negative sentiment that was fanned by the shrinking dollar stash of the country.

However, the local unit is likely to bounce back later this week on expected inflows from the Asian Infrastructure Investment Bank (AIIB).

The Pakistan Business Council (PBC) in a note posted on their Twitter handle stated that expecting the Pakistani rupee to defy gravity (in view of its depleting forex position) is unrealistic.

“Bolstering rupee through administrative controls renders exports less competitive and imports (even curbed), cheaper. Where is the sense in this when we want the reverse — higher exports?” it said.

Tresmark last week’s client note stated that the State Bank of Pakistan (SBP) is expecting external flows from multilateral (such as World Bank, Asian Development Bank, AIIB and others), bilateral and other sources.

However, contrary to the dominant opinion, the platform for treasury markets said that despite some positives, the rupee weakening doesn’t seem to end soon.

The rupee/dollar parity could test previous highs if the pressure on the forex reserves is not eased, it noted.

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Irfan Siddiqui meets with the PM and informs him about the Senate performance of the parliamentary party.

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The head of the Senate’s Foreign Affairs Standing Committee and the PML-N’s parliamentary leader paid Prime Minister Muhammad Shehbaz Sharif a visit in Islamabad.

Senator Irfan Siddiqui gave the Prime Minister an update on the Parliamentary Party’s Senate performance.

Additionally, Senator Irfan Siddiqui gave the Prime Minister an update on the Senate Standing Committee on Foreign Affairs’ performance.

He complimented the Prime Minister on his outstanding efforts to bring Pakistan’s economy back on track and meet its economic objectives.

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Business

SIFC Increases Direct Foreign Investment: Investment in the Energy Sector Rises by 120%

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The Special Investment Facilitation Council is intended to help Pakistan’s energy sector attract $585.6 million in direct foreign investment in 2024–2025. The amount invested at the same time previous year was $266.3 million.

This is a notable 120% rise, mostly due to investments in gas exploration, oil, and power. Such expansion indicates heightened investor confidence and emphasizes the development potential in important areas.

The State Bank reports that foreign investment in other vital industries has increased by 48% to $771 million.

This advancement is a blatant testament to SIFC’s efficient investment procedure and quick project execution.

The purpose of the Special Investment Facilitation Council is to establish Pakistan as an investment hub by aggressively promoting regional trade and investment in the energy sector and other critical industries.

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Business

Discos report losses of Rs239 billion.

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When compared to the same period last year, the data indicates that discos have decreased their losses in the first quarter of the current fiscal year.

The distribution businesses recorded losses of Rs239 billion in the first three months of the current fiscal year, a substantial decrease from the Rs308 billion losses sustained during the same period the previous year.

Additionally, the distribution businesses’ rate of recovery has improved. It has increased to 91% in the first quarter of this year from 84% in the same period last year, indicating success in revenue collection.

Regarding circular debt, the Power division observed a notable change. Last year, between July and October, the circular debt grew by Rs301 billion. Nonetheless, this year’s first four months saw a relatively modest increase in circular debt, totaling about Rs11 billion.

These enhancements show promising developments in the electricity sector’s financial health in Pakistan, where initiatives are being made to accelerate recovery rates and slow the expansion of circular debt.

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