Dollar is traded below Rs288 as rupee manages to sustain the surge

Early interbank trading starts with an 85 paisa gain

KARACHI (Web Desk/Dunya News) – The US dollar continues losing ground against Pakistan rupee as the greenback was traded for Rs287.75 during ongoing session on Thursday, representing a gain of Rs1 for the local currency.

In the case of open market, the dollar was available for Rs288 as the rupee appreciated by another Rs2.

The government in Pakistan has managed to reverse the devaluation after the rupee had sunk to the new record low of Rs307.10 in interbank and Rs333 in open market trading, worsening the cost-of-living crisis in the country which is witnessing record-high inflation amid rising food prices and the repeated increase in energy rates.

However, things started changing earlier this month when the rupee bounced back both in interbank and open market exchange rates as the government clamped down on market manipulators and dollar’s smuggling across Pakistan’s western borders into Afghanistan.

The devaluation experienced by the rupee since 2018 has triggered in the economic mess we are in today resulting increase in import bill, cost of doing business, cost of living, and rising food and fuel prices – the factors that are sustaining inflation in the country.

Meanwhile, the currency market in Pakistan is moving in a direction completely opposite to what we are seeing globally, as the high interest rates mean investors have been taking refuge in the “safe haven” [US dollar].

Read more: Dollar grows stronger amid high interest rates, Brent futures hit one-year high

But it again shows that the record depreciation in Pakistan was a product of market manipulation – artificial shortage caused by hoarding and smuggling of dollar – which has been arrested thanks to the clampdown on the elements who pushed Pakistan into an economic mess.

It’s a developing story. Details to follow.