Rupee weakens

The rupee ended slightly weaker on Monday, amid an uptick in the dollar demand from importers, dealers said.

The local currency closed at 155.28 against the greenback, compared with the previous closing of 155.23 in the interbank market. Dealers said the currency faced little downward pressure, as importers bought dollar to cover their payments. “There were some payments pending since Friday due to closure of the US markets, amid Thanksgiving and Black Friday holiday,” a dealer said.

“We expect the rupee to recover losses, trading at 155.20 and 155.25 in the coming sessions,” he added. A positive outlook for the country’s economy presented by the international rating agency could also support boost the currency.

Moody’s Investors Service upgraded Pakistan’s outlook from ‘negative’ to ‘stable’, reaffirming the country’s rating of B3.

“The change in outlook to stable is driven by expectations that the balance of payments dynamics will continue to improve, supported by policy adjustments and currency flexibility. Such developments reduce external vulnerability risks, although foreign exchange reserve buffers remains low and will take time to rebuild,” it said.

Moody’s had downgraded Pakistan’s ratings outlook to negative in June last year due to increased external vulnerability risk, amid lower foreign exchange reserves.