Rupee stable

The rupee ended almost firmer against the dollar in the interbank market on Monday, dealers said. The local currency closed at 154.85 against the greenback, compared with the previous closing of 154.83.

In the open market, the rupee gained 10 paisas to settle at 155.10/dollar. Dealers said the local unit was range-bound due to fewer import payments and higher remittances from overseas Pakistani workers. Healthy dollar inflows because of rising investment inflows and higher remittances are expected to hold the rupee steady for now, they said.

Remittances from Pakistani workers abroad increased 3.31 percent to $11.394 billion in the six months of the current fiscal year of 2019/20. In December, remittance flows stood at $2.097 billion, which is 15.25 percent higher from previous month.

State Bank of Pakistan Governor Dr Reza Baqir, in a statement issued last week, said that exchange rate flexibility and the shift to a market-based exchange rate system in May 2019 had significantly reduced the current account deficit and led to a notable improvement in foreign exchange reserves and net borrowing.

Preserving the policies of a market-based exchange rate system and zero lending of the State Bank to the government would help preserve reserves and; therefore, strengthen the country’s financial sovereignty, he added.