Rupee strengthens

KARACHI: The rupee managed to post gains on Thursday helped by dollar inflows from remittances and greenback selling from exporters, dealers said.

In the interbank market, the rupee closed at 156.74 against the dollar, 0.14 percent stronger than Wednesday’s closing of 156.96.

The rupee also gained ground in the open market. It ended at 157.40 against the dollar, compared with the previous close of 157.60.

“Though the dollar demand from importers and the companies remained high, an increase in inflows in the form of remittances from Pakistanis abroad, as well as dollar sales from exporters helped the rupee gain value,” a foreign exchange dealer said. “We expect the rupee to hold steady against the dollar in the coming days. The rupee is unlikely to cross the 156 level this week,” he added. The local currency had been under pressure for the last couple of weeks due to inflation, June-end import payments, debt repayment, and low remittances after Eid. Weak supplies had also put pressure on the local unit.

Analysts expect the rupee to hover at 158/dollar by the end of the current fiscal year. The future course of the rupee is likely to be dependent on the position of the Real Effective Exchange Rate, the potential outcome of the Financial Action Task Force’s upcoming meeting, and the progress in talks with the International Monetary Fund. The domestic currency could trade at 166 level in the upcoming fiscal year.