Rupee gains marginal strength against dollar

KARACHI: The Pakistani rupee gained strength against the US dollar in the interbank market on Thursday, aided by weak dollar demand from importers, dealers said.The rupee finished at 278.4 per dollar, marginally stronger than its previous close of 278.5.

“The rupee received modest support from the decline in importer dollar demand and the improvement in exporter dollar inflows,” said a currency dealer.

The rupee extended gains for a second consecutive session in the open market. It was trading at 279.7 to the dollar, compared with 275 in the previous session.Ahead of the central bank’s monetary policy decision on Monday, investors are hesitant to take a long position and are interested in a wait-and-see mode. In the upcoming trading session on Friday, it is anticipated that the local currency will remain range-bound, according to dealers.

The government raised Rs422 billion at the T-bill auction on Wednesday, surpassing the target of Rs150 billion. Participation reached Rs1.8 trillion. The market was anticipating another rate cut, as seen by the 30-56 basis point decline in the cut-off yields on three-, six-, and 12-month papers.

The flawless execution of a staff-level agreement between the International Monetary Fund and Pakistan for a new $7 billion Extended Fund Facility has boosted the currency prospects and expectations, according to analysts.Since Pakistan has secured a new loan deal with the IMF, the market anticipates a reduced depreciation of the rupee this year due to optimistic sentiment.