KARACHI: The rupee dropped for the fourth straight session in the interbank market on Thursday due to a combination of weak supply from remittances and export proceeds as well as an increase in importers' demand for dollars.
The rupee lost nine paisas to close at 278.48 to the US dollar. The local unit had ended at 278.39 on Wednesday. In the open market, the rupee did, however, slightly strengthen versus the greenback. It was trading at 279.69 per dollar, up from the previous session's 279.82.
Dealers said the rupee was losing strength since there was a demand for dollars but not enough supply to accommodate it.The State Bank of Pakistan's most recent data, which shows that imports increased to $4.449 billion in March—up 2 percent from the previous month and 7 percent from a year earlier—shows that imports have gained momentum.
According to analysts, the rupee will likely remain stable, but after the June crossing, it may gradually weaken. This opinion is in line with that of the finance minister, who stated that he doesn't anticipate any significant declines over the coming year other than the historical norm of 6–8 percent. Large-ticket forward sales are absent, although swaps premiums have rebounded. There are still exporters that sell their earnings to lock in profit margins, albeit in smaller quantities.