Rupee weakens for second straight session

KARACHI: The rupee extended losses against the dollar for the second consecutive session in the interbank market on Friday. The rupee closed at 278.41 per dollar, compared with Thursday’s closing price of 278.35.

Dealers said the local currency lost ground due to year-end dollar demand from importers. However, the supplies remained weak on the back of sluggish exporter conversions. In the open market, the rupee also declined, closing at 279.38 to the dollar from 279.34 the day before. Pakistan’s foreign exchange reserves held by the central bank rose by $31 million to $12.08 billion as of December 13, according to data from the State Bank of Pakistan on Thursday.

The country’s forex reserves increased by $32 million to $16.633 billion. The reserves of commercial banks rose by $1 million to $4.551 billion.

The surplus in the current account, along with the improved foreign investment inflows, helped build up the SBP’s FX reserves, despite weak official inflows, the SBP said in a monetary policy statement.

“Going forward, sustained uptrend in workers’ remittances and exports, along with favourable international commodity prices, are expected to keep the current account deficit near the lower bound of the projected 0–1 per cent of GDP range in FY25,” it said.“This will enable the SBP’s FX reserves to exceed $13 billion by June 2025,” it added.