On Monday, the Pakistani rupee recorded a significant decline against the US dollar, depreciating 0.75% in trading in the inter-bank market.
At around midnight, the rupee was traded at 280, a decrease of Rs2.1.
During the previous week, the rupee registered a substantial 2.91% gain against the US dollar as the finalisation of the Stand-By Arrangement (SBA) with the International Monetary Fund (IMF) strengthened the local currency.
On Friday, the rupee settled at 277.9 in the inter-bank market, with a similar gain in the open market helping it close between 279 and 282. The narrower gap reflected the stability in both currency markets and remained a condition of the new SBA that will run through the second half of the current fiscal year.
The new programme, seen by many as an upgrade to the Extended Fund Facility that expired unsuccessfully at the ninth review, is subject to the approval of the IMF Executive Board. The IMF has also confirmed Pakistan’s agenda is to be taken up on July 12 even though its official website calendar had not been updated to include Pakistan as of Monday morning.
Internationally, the US dollar was on the defensive on Monday as investors scaled back expectations over how much further US interest rates would rise after US jobs data showed the smallest increase in 2-1/2 years.
