Rupee marginally falls after India’s strikes on Pakistan

KARACHI: The rupee slightly declined against the dollar on Wednesday following India’s strikes on specific locations in Pakistan, which prompted a retaliatory response from that country.

The rupee fell 0.04 per cent, or 10 paisas, to 281.47 versus the dollar in the interbank market.

In the open market, the rupee inched down, trading at 283.13 per dollar, compared with 283.12 in the previous session.

Dealers said that the rupee has been under pressure since last week, and today’s decline in the local currency signifies worries regarding the potential for further escalation as the military action by India against Pakistan has heightened cross-border tensions.

The Prime Minister’s Office reported that Pakistan had downed five Indian fighter jets in response to an attack. The armed forces have been given the authority to respond to this Indian aggression.

Historically, such incidents are isolated and short-lived, often enabling both sides to claim a symbolic victory for their domestic audiences. With the likely involvement of global powers, the situation is expected to de-escalate in the coming days, said Chase Securities in a note.

Investors are optimistic about the upcoming IMF board meeting scheduled for May 9, which will determine the next loan tranche of the $7 billion loan programme for the country.