Rupee extends losses for second consecutive session

KARACHI: The Pakistani rupee continued to weaken against the US dollar for a second straight session in the interbank market on Thursday.

The rupee ended at 278.66 to the dollar, compared with Wednesday’s close of 278.52.Dealers said a persistent dollar buying from importers and a delay in the final approval of a $7 billion loan programme for Pakistan from the International Monetary Fund put pressure on the local unit.

In the open market, the rupee stayed flat and closed at 280 per dollar.The finance minister announced on Wednesday that ongoing negotiations with the IMF are progressing positively, with a deal expected by September. “The deadline for this agreement has been extended from the end of August to the end of September, which, given the current stability of external finances and the absence of major debt repayments in the coming weeks, may not pose a significant issue,” said Chase Securities in a note.

“However, this extension raises questions about the unmet requirements that have delayed the deal, despite a staff-level agreement being signed weeks ago. It remains uncertain whether these delays are due to longer-term debt rollovers (three to five years) or other unresolved matters,” it added. Providing more details on the situation could have bolstered confidence in the financial markets, it noted.