The Pakistani Rupee (PKR) continued its noteworthy appreciation against the US Dollar (USD). Friday’s interbank session witnessed the PKR climbing nearly 25 paisa to close at PKR 279.0366 per USD, showcasing a slight yet significant improvement from the previous session’s closure at PKR 279.29 per USD.
The Pakistani Rupee (PKR) has shown commendable resilience this week, inching upwards by approximately 16 paisa against the U.S. Dollar (USD), concluding at a commendable PKR 279.04 to the USD from a prior week’s closing of PKR 279.18. The domestic currency’s journey through the trading session was noteworthy, appreciating by about 25 paisa, reaching an intraday high of 279.65, and a low of 279.4, reflecting its steadfastness in the financial markets.
PKR INTERBANK EXCHANGE RATES ON MARCH 07, 2024
| Country Name | Symbol | Rate |
|---|---|---|
| United States | USD | 279.04 |
| Eurozone | EUR | 305.20 |
| United Kingdom | GBP | 357.68 |
| Japan | JPY | 1.8871 |
| United Arab Emirates | AED | 75.97 |
| Saudi Arabia | SAR | 74.40 |
| Australia | AUD | 185.17 |
| Canada | CAD | 207.67 |
OPEN MARKET PERFORMANCE
In the open market, the Rupee’s valuation against the Dollar was pegged at 279.11 for buying and rose to 281.74 for selling, marking a consecutive triumph in its performance against the globally dominant currency.
ANALYTICAL INSIGHTS INTO PKR’s VALUATION
Goldman Sachs’ Economic Research, leveraging the GSDEER framework, highlights the Rupee as nearly 20% undervalued over a 12-month projection, presenting a potential 26% nominal carry. The anticipation of positive real rates emerges as a pivotal element for the Rupee’s upward trajectory, contingent on a reduction in inflation rates.
However, recent times have seen the Rupee deviate from its stable trajectory against the USD amidst the political and economic volatilities following the general elections on February 8. The election of Shehbaz Sharif as Prime Minister for a second term signifies a pivotal moment for the nation’s economic reform and sectoral restructuring, with the International Monetary Fund (IMF) also signaling readiness to support Pakistan in achieving macroeconomic stability.
A GLIMPSE AT GLOBAL CURRENCY COMPARISONS
The Rupee experienced mixed fortunes against other major currencies. It depreciated by 97.09 paisa against the Euro, concluding at 305.2. The British Pound and Swiss Franc also saw upticks against the PKR, with the Pound rising by 2.1 rupees and the Franc by 1.63 rupees. Conversely, minimal shifts were noted against the Japanese Yen and the Chinese Yuan, with slight depreciations. The Saudi Riyal and the U.A.E Dirham saw marginal declines against the PKR, further illustrating the fluctuating dynamics of international currency exchanges.
YEARLY PERFORMANCE AND MARKET OUTLOOK
The PKR has fortified its position against the USD, appreciating by 6.95 rupees or 2.49% during the current financial year, and by 2.82 rupees or 1.01% over the calendar year, showcasing a trend of gradual but steady appreciation.
MONEY MARKET MOVEMENTS
The money market revealed a downward adjustment in the 6-month Karachi Interbank Bid and Offer rates, aligning with the falling yields in the Market Treasury Bills (MTB), signaling a market sentiment leaning towards an anticipated rate cut, buoyed by the easing inflation to a 20-month low. The State Bank of Pakistan’s strategic interventions through reverse repo and Shariah-compliant Open Market Operations injected a substantial Rs7.63 trillion, aiming to sustain liquidity and stimulate economic stability.
