US dollar drops to Rs290.55

KARACHI: The Pakistani rupee maintained its winning momentum against the US dollar, gaining 0.42 percent during the opening hours of trading in the inter-bank market on Monday.

At midday, the rupee was hovering at 290.55, an increase of Rs1.21, in the inter-bank market.

During the previous week, the rupee appreciated another 1.74 percent, closing positive in all five sessions to settle at 291.76 against the US dollar in the inter-bank on Friday.

The rupee’s rate in the open market has also become stronger, reducing the ‘premium’ to negligible values and meeting the benchmark set by the International Monetary Fund (IMF).

While many experts say the rupee’s appreciation is on the back of administrative and enforcement measures, some believe the gain reflects the currency’s fundamental value if ‘speculation’ and negative sentiment were to be kept aside.

“PKR gained over 5.3%, or Rs15.3 against USD in the last thirteen consecutive trading sessions due to strict measures against Afghan transit and hawala,” said Shahid Ali Habib, CEO of brokerage house Arif Habib Limited (AHL) in a post on social media platform X on Saturday.

PKR gained (+5.3%, PKR 15.3) against $ in the last thirteen consecutive trading sessions due to strict measures against Afghan transit and hawala.

We expect PKR to further gain in coming days to at least reach Rs. 278-280/$ if these positive measures continue like this and some… pic.twitter.com/WUUQx4ccww

— Shahid Ali Habib (@ShahidAliHabib1) September 23, 2023

“We expect PKR to further gain in coming days to at least reach Rs278-280 against USD, if these positive measures continue like this and some external flows materialise timely,” added Habib.

Oil prices, a key indicator of currency parity, rose on Monday as investors focused on a tighter supply outlook after Moscow issued a temporary ban on fuel exports while remaining wary of further rate hikes that could dampen demand.