Rupee failed to extend previous gains

The Pakistani currency on Wednesday failed to sustain a modest day's rally against the US dollar as it resumed its downward trend amid growing demand for the dollar to pay for imports and service foreign debt.

The rupee fell 0.17% (or Rs0.39) and on the interbank market, he closed at his six-week low of Rs223.81 per dollar.

The government's priority to gradually loosen administrative controls on imports is further boosting demand for the dollar.

Last week, the central bank said it had pledged to process all import payments up to $100,000 at a time. Previously, we limited import orders to a maximum of $50,000. Also on the minds of traders is the looming repayment date of the $1 billion sukuk (Islamic law-compliant bonds) that matured on December 5, 2022, and they will be forced to pay for their imports. I had to buy dollars to arrange the meeting.

The currency recovered by 0.11% (or Rs0.24) to Rs223.42 on Tuesday. His current account deficit in October was $567 million, one-third of his $1.72 billion deficit recorded in the same month last year.

Published in The Express Tribune, November 24th, 2022.