Rupee inches up against dollar

By Our Correspondent
June 14, 2024
A currency exchange worker counts Pakistan currency.— AFP/file

KARACHI: The rupee edged higher in the interbank market on Thursday due to weak importer demand for dollars and ease in uncertainty following the release of the budget, dealers said.


The rupee ended at 278.59 to the US dollar, 0.01 per cent higher than its Wednesday’s close of 278.61.Dealers stated that the soft dollar demand for import payments helped the local unit recover from three straight days of losses. The rupee gained support as exporters sold dollars in the market due to reduced budget-related uncertainty.

Pakistan’s dollar bonds saw an increase in value following the government’s announcement of tax hikes in the annual budget presented on Wednesday, Bloomberg reported.The government aims to boost revenue as it negotiates a new bailout with the International Monetary Fund, according to a report by Bloomberg. The country’s 2029 bond rose by 1.5 cents to 90.030 cents on the dollar, while bonds maturing in 2025, 2026, 2027, 2031, and 2051 also experienced gains.

In the open market, however, the rupee lost ground. It was trading at 280.25 per dollar, compared with 280.12 in the previous session.The government set an ambitious tax collection target of Rs18.9 trillion for FY25. The Federal Board of Revenue (FBR) aims to collect Rs12.97 trillion, an increase of Rs3.72 trillion compared with last year. It remains to be seen how the additional revenue will be collected through the new taxation measures introduced in this budget.The government’s target to increase the primary surplus to 2.0 per cent of GDP in FY25 from 0.4 per cent in FY24 is a positive step towards reducing public debt levels.