KARACHI: The rupee surged to its highest level in over five months on Friday, buoyed by a rise in foreign exchange reserves and growing confidence in the nation's economic prospects.
In the interbank market, the rupee closed at 277.94 against the dollar, marking its strongest position since October 17, and improving from Thursday's close of 278.03.
The currency extended its winning streak to six consecutive sessions, reflecting a broader trend of gains against the greenback. Parallelly, in the open market, the rupee appreciated to 280.27 per dollar, up from 280.41 in the prior session.
Currency dealers attributed the rupee's steady appreciation to robust inflows from remittances and export revenues. According to the latest data, the central bank reserves climbed for the third week in a row, reaching $8.022 billion as of March 22, a slight increase of $4 million from the previous week.
Analysts pointed to the State Bank of Pakistan's (SBP) growing reserves, bolstered by dollar purchases in the interbank market and a seasonal uptick in remittances during the holy month of Ramadan.
The smooth handover to a new administration, a resilient rupee, and the completion of Pakistan's second and final staff-level agreement with the International Monetary Fund (IMF) under the standby arrangement have all contributed to the positive market sentiment.
Finance minister Muhammad Aurangzeb expressed optimism on Friday, citing significant improvements in key economic indicators as the country entered 2024 on a strong footing.
Addressing the business community at the Gong Ceremony at the Pakistan Stock Exchange, Aurangzeb announced that negotiations for a new IMF bailout package are slated to commence next month.