Rupee ends four-day losing streak

KARACHI: The rupee strengthened on Monday, breaking free from a four-day losing streak due to the better availability of dollars.

The rupee ended at 277.97 per dollar in the interbank market. The local currency had ended at 278.05 on Friday.Despite the demand from importers, traders said the rupee rebounded from losses thanks to an increase in the supply of dollars brought about by exporter conversions.

The rupee closed at 278.98 against the dollar in the open market, compared with 279.02 in the previous session. According to traders, the persistent drop in inflation readings also boosted investor sentiment.

Last month, Pakistan’s inflation dropped to its lowest level in almost six years, giving the central bank further room to lower interest rates.The consumer price index recorded at 4.9 per cent in November. This was 7.2 per cent in October.

Most analysts anticipate a 200 basis point (bps) cut in the benchmark interest rate at the central bank’s policy meeting on December 16.The State Bank of Pakistan (SBP) purchased $569 million from the interbank market in August, compared with $722 million in the previous month. The central bank made these purchases to build its foreign exchange reserves and pay foreign loans.