Rupee ends slightly stronger against dollar

KARACHI: The rupee saw a marginal strengthening against the US dollar in the interbank market on Friday, largely due to decreased demand from importers.The rupee closed at 278.12 against the US dollar, compared with Thursday’s close of 278.17.

Dealers said that, as importers showed less interest in purchasing US dollars, the local currency barely gained ground after recovering from its losses in the previous session. Additionally, foreign exchange reserves remained stable, improving investor sentiment. The central bank’s foreign exchange reserves increased by $19 million to $9.424 billion as of July 12.

The rupee stayed flat for the third consecutive session in the open market. It settled at 280.5 versus the greenback, unchanged from the previous close.The State Bank of Pakistan reported on Friday that the real effective exchange rate (REER) index depreciated to 100.1 in June from 100.7 in the previous month.

Analysts expect the rupee to remain stable in the short to medium term due to the finalization of a new loan deal with the International Monetary Fund (IMF).According to the latest Moody’s report, the new IMF programme will improve Pakistan’s (Caa3 stable) funding prospects. “The programme will provide credible sources of financing from the IMF and catalyze funding from other bilateral and multilateral partners to meet Pakistan's external financing needs,” it said.