Rupee closes mildly weak against dollar

Our Correspondent
Friday, Jun 21, 2024

KARACHI: The rupee closed a little weaker on Thursday due to dollar demand from importers after a long weekend.

The rupee ended at 278.6 to the US dollar, lower than Friday’s close of 278.5 in the interbank market. The markets were closed from Monday to Wednesday for public holidays on account of Eidul Azha that fell on Monday.

“We saw importers entering the currency market to purchase dollars for making payments after the market reopened following a three-day holiday,” a foreign exchange dealer said.The rupee also experienced a slight decline in the open market, trading at 280.32 per dollar, compared with 280.20 in the previous session.

Analysts expect the rupee to remain range-bound in the coming sessions as US dollar sales from exporters outweigh demand from importers.The State Bank of Pakistan emphasizes on the timely mobilization of financial inflows, which are essential to meet external financing requirements and further strengthen foreign exchange buffers for the country to effectively respond to any external shocks and support sustainable economic growth.

The current account posted a surplus for the third consecutive month in April on the back of robust growth in remittances and exports. During July-April FY24, the current account deficit narrowed significantly to $202 million.

Workers’ remittances also remained robust in recent months, reaching an all-time high of $3.2 billion in May 2024. The resultant lower current account deficit, along with improved foreign direct investment and the disbursement of the International Monetary Fund’s tranche in April, has facilitated ongoing large debt repayments and supported the SBP’s forex reserves.