Rupee slightly up against dollar

KARACHI: The rupee rose slightly in the interbank market on Wednesday, taking comfort from a lackluster dollar demand from importers, dealers said.

The rupee ended at 285.39 to the dollar, compared with its previous close of 285.52. For the second straight session, the local currency in the open market continued its flattish trend. The rupee remained firm at 287 per dollar.

“The demand and supply of dollars in the market determine the currency; therefore the rupee saw minor gains as the need for US dollars to pay for imports decreased,” a currency dealer said. In the coming sessions, the dealer expects that the rupee will remain range-bound and trade at 285 per dollar.

“For the time being, it appears hard to see the rupee moving significantly. Perhaps any negative news flows will change that.” According to Bloomberg, the rupee is expected to have the worst performance among Asian currencies this year and will continue to weaken over the next three years.

Pakistan's high inflation, trade deficit, debt payments, shortfall in external funding, and decline in foreign investments are all cited in the report as reasons for the rupee’s weakness. Report indicates that by the end of 2024, the Pakistani rupee will likely continue its decline and hit a record low of 350 per US dollar.