Rupee firm

KARACHI: The rupee remained firm against the dollar in the interbank market on Wednesday, dealers said.

The local currency ended at 160.37 against the dollar, almost firmer than Tuesday’s closing of 160.35 because of the lack of import payments.

In the open market, the rupee closed at 160.40 versus the greenback, compared with 160.35 in the previous trading session.

Dealers said the limited importers’ demand for the dollar and the ample supplies kept the rupee stable during the trade.

The local unit was also supported by the stable outlook for the banking sector by the Moody’s Investors Service rating agency, they added.

The sentiment was boosted by traders’ optimism that Pakistan’s banking system reflects the bank's solid funding and liquidity. However, a tough, but improvement in the operating environment is expected to affect asset quality and profitability.

“The rupee is likely to stick in range-bound trading in the coming sessions. We don’t expect the rupee/dollar parity to see anything unexpected that could put the pressure on the domestic currency and alter its outlook,” a dealer said.

There are many upsides for the rupee to remain stable. It has the backing of a healthier current account, strong Roshan Digital Account inflows and the potential resumption of the stalled International Monetary Fund loan programme.