Rupee ends stable

The rupee closed slightly firmer in thin trade on Monday as many importers held back their demands on anticipations of further strength in currency value in the near-term.

The rupee ended at 158.61 per dollar, compared with previous close of 158.66 in the interbank market. In the open market, the currency posted gains to close at 158.90 versus the greenback. It had finished at 159.40 in previous session.

Dealers said the local unit traded stronger due to improvement in official inflows. “The rupee was stable as the demand for the foreign exchange remained thin,” said a currency dealer. “We see the rupee will trade at 160-161 against the dollar in the sessions ahead.”

The currency depreciated almost 14 percent against the greenback since the start of this year. It has fallen 43.4 percent since December 2017, making it one of the worst performing currencies in Asia, as heavy foreign outflows and debt payments weighed on the local currency.

The IMF accord, which signed in July, foresees a “market-determined” rate for the rupee, which previously has been managed by the central bank in a de facto controlled float. The State Bank of Pakistan repeatedly said it was watching the foreign exchange market closely and would act in the case of “unwarranted” volatility. The country’s reserves stood at $15.577 billion. It had amounted to $15.020 billion in previous week. The increase in SBP’s reserves is mainly due to inflow of $500 million received from Asian Development Bank.