PKR appreciates against dollar in interbank, open market

Karachi: The Pakistani rupee maintained its momentum against the US dollar, appreciating another 0.6% during trading in the inter-bank market. Rupee continued its appreciation run against the US dollar in the open market as well on Monday.

The rupee gained 0.83% last week to close at 302.95 against the US dollar in the interbank market, but there was much more to the story as its gap with the open market shrunk significantly and a rumored crackdown on smuggling and speculation helped the currency recover after it hit a record low last Tuesday.

The currency gained ground as a result of the State Bank of Pakistan's (SBP) decision to tighten controls on exchange companies, news of the army chief's intervention, and the deployment of law enforcement officers at currency dealer outlets.

Prior to this week's US inflation estimate, the US dollar was under pressure internationally.

US inflation data for the month of August is due on Wednesday, with traders on the lookout for whether the world’s largest economy is indeed on track for a “soft landing”, and whether the Fed has further to go in raising rates.

The dollar and US Treasury yield both increased last week as a string of strong economic data fueled speculation about potential future rate hikes from the Federal Reserve.

The dollar index decreased marginally to 104.84 after finishing the previous week with eight straight weeks of gains, its longest streak since 2014.