Rupee breaches 277.9 per dollar level in interbank market

KARACHI: The rupee lost ground, surpassing 277.9 against the dollar in the interbank market, on Thursday as a result of importers’ demand for the greenback.

The rupee closed at 277.94 to the dollar, slightly down from 277.89 in the previous session.The local currency had been trading between 277.6 and 277.9 for the past several sessions, according to dealers, but today it broke through this level, indicating some pressure on the rupee.

The rupee traded at 278.88 per dollar in the open market, down from 278.88 in the previous session. According to dealers, the rupee is gradually declining even though the foreign exchange reserves are increasing, the current account deficit is showing a steady recovery, and remittances are still strong. This demonstrated a growing need for dollars to pay for imports that are picking up amid increasing economic activity.The current account posted a surplus for the second consecutive month in September 2024, narrowing the cumulative deficit to $98 million in the first quarter of the current fiscal year. Robust workers’ remittances and higher exports helped contain the deficit. These developments, along with the receipt of the first tranche under the IMF programme, helped in the further build-up of the State Bank of Pakistan’s forex reserves.