On Friday Pakistan’s rupee closed weaker against the US dollar. According to dealers this is because of a greater demand for the dollar from importers.
The rupee’s value against the greenback closed at Rs158.95. This represents 51 paisas or 0.32% lower than its prior closing of Rs158.44.
Within the open market the rupee closed at Rs159.40 against the dollar after it posted nominal gains, in comparison with Rs159.50, its closing value the previous Friday.
Dealers was of the opinion the rupee lost ground because inflows were insufficient to meet the demands of importers.
The lack of the inflow of remittances after Eid ended, weighed on the currency, is the explanation of a forex dealer. He further said the greenback was purchased by importers after the reopening of the foreign-exchange market at the end of the Eid holidays.
During the public holidays from 12 to 15 August, commemorating Eid-ul-Azha & independence day, also saw the closing of financial markets.
However, according to the expectations of many dealers, the rupee will continue its downward spiral next week, anticipating the substantial demand from importers & the corporate sector, for foreign exchange.
Nonetheless, the local currency was thus far not impacted by the escalating tension between India and Pakistan.
It is likely that the rupee will be trading between Rs159.20 – Rs159.25 during the forthcoming sessions.
According to a recent report by Moody’s, the rating agency said a perpetuated military conflict between India & Pakistan would result in the slowdown of growth due to a prolonged blow to both consumer & business confidence and direct foreign investment.