Pakistani Rupee bounces back against US Dollar, first sign of economic revival
KARACHI: Pakistani currency has started to bounce back against US dollar.
Pakistani Rupee hit a seven-week high at Rs138.78 against the US dollar in inter-bank market on Friday, according to the State Bank of Pakistan, after the country successfully mitigated the risk of default following receipt of $2 billion from friendly countries.
Simultaneously, the rupee revived to a four-week high at retail market to 139 against the greenback on Saturday, according to a forex website.
“The $2 billion inflows from the UAE and Saudi Arabia (on Thursday and Friday) has partially eased the panic at currency markets,” said a banker on condition of anonymity.
The receipts have surely improved the country’s foreign currency reserves from less than two-month import cover prior to the inflows. “The improvement is reflecting in currency markets,” he said.
With the latest inflows, the two Gulf countries deposited a total of $4 billion in the past three months under financial assistance packages totalling $6 billion to help stabilise Pakistan’s foreign currency reserves which, as of last week, dropped to a 57-month low of $6.63 billion.
Besides, speculation about receiving a similar assistance package from China also echoed in the market.
The inflows have eliminated chances of further devaluation in the rupee in the short-run, said the official.