Rupee higher

The rupee strengthened against the dollar on Tuesday due to increased supply of the greenback, dealers said.

In the interbank market, the rupee closed at 155.18 against the dollar, up from Monday’s closing of 155.28 and dealers expect the currency to strengthen further in the sessions ahead.

The local unit posted gains because of lower import payments and due to the positive sentiment about the country’s economic outlook. “There are some foreign inflows that helped the currency appreciate,” a dealer said. “The bright prospects for Pakistan’s economy are also supporting the local unit,” he added.

In the open market, the rupee gained another five paisas against the dollar. It closed at 155.35 versus the greenback, compared with 155.40 in the previous session. Moody’s Investors Service upgraded Pakistan’s credit rating outlook to ‘stable’ from ‘negative’, amid the country’s economic reforms supported by the International Monetary Fund programme.

This development could boost foreign investors’ confidence in Pakistan’s economy. Dr Abdul Hafeez Shaikh, adviser to the prime minister on finance, said that the Moody’s credit outlook endorsed the government’s success in stabilising the economy and laying a firm foundation for a robust long-term growth.