KARACHI: After back-to-back losses in the last few sessions, Pakistan’s rupee reversed the trend against the US dollar as it recorded a slight gain of 0.35% in the inter-bank market on Monday.
The trend reversed after the traders started selling dollars as the government increased the price of petrol by Rs30 per litre, an underlying condition of the International Monetary Fund (IMF) for the resumption of the Extended Fund Facility.
Analysts believe that the move helped ease some pressure on the local unit and a sustained IMF engagement with Pakistan would open up the flow of funds from China, Saudi Arabia, the World Bank, Asian Development Bank and the International Finance Corporation.
Moreover, Finance Minister Miftah Ismail’s assurance that the deal with the Fund will be finalised this week further supported the uptrend.
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However, dealers believed that the markets may remain volatile as fresh developments can change the sentiment on a day-to-day basis.
The local currency started its losing streak due to depleting foreign exchange reserves, but it sank from 186-202 per dollar during the current month as reserves declined by about $900 million with no sight of fresh inflows.