KARACHI: The rupee is predicted to rise next week as a result of significant inflows of external funding and anticipated transfers of funds from foreign bond auctions.
Import payments, on the other hand, may increase demand for foreign currency and lower the rupee value during the next week.
According to estimates issued by the State Bank of Pakistan (SBP) on July 8, 2021, the country’s foreign exchange reserves reached an all-time high of $24.41 billion by the week ended July 2, 2021.
Foreign exchange reserves increased as a result of inflows of $1 billion from China and $440 million from the rest of the world obtained under the external debt.
The central bank earned additional $1 billion from the government of Pakistan’s auction of international sovereign bonds.
Furthermore, the country’s exports increased by 68.36% to $2.69 billion in June 2021, up from $1.59 billion in the same month the previous year.
The value of the local currency may be under strain, since imports increased by 70% to $6.28 billion in June 2021, compared to $3.7 billion in the same month last year.
Furthermore, scheduled external payments may put pressure on the currency next week.
The rupee fell 99 paisas versus the dollar during the previous week (July 5-July 9). In the interbank foreign exchange market, the rupee began the week at Rs158.18 versus the dollar on July 5, 2021 and ended the week at Rs159.17 on July 9, 2021.