Dollar gains more ground against rupee

• Rupee closes at 218.38 after losing 0.23% against US dollar.
• Going forward, analysts expect the currency to remain range-bound.
• Globally, US dollar remained steady against other currencies.

KARACHI: The US dollar strengthened further against the Pakistani rupee boosted by a lack of inflows and a decline in remittances.

According to the State Bank of Pakistan (SBP), the rupee closed at 218.38 after depreciating Rs0.05 or 0.23% against the greenback.

On Wednesday, the currency recorded its first depreciation in the past two weeks after worker remittances slowed down 12.3% year-on-year to $2.4 billion and export earnings in September.

The drop in inflows changed sentiment in the interbank market and encouraged importers to buy dollars at the prevailing rate before it became expensive.

The excessive supply of dollars in the market helped the rupee to stage a 13-day-long rally. However, the supply of foreign currency decelerated after the sluggish data on worker remittances.

After recovering throughout the month of October, which came on the back of a shift in sentiment and actions taken by the central bank against players involved in speculative activity, the rupee is showing signs of stabilisation against the US dollar.

Earlier, the rupee emerged as the best-performing currency in the world last week after it notched up one of the largest gains of 3.9% in the week ended October 7 compared to all other currencies on the Bloomberg terminal.

Going forward, analysts expect the currency to remain range-bound in the coming days and see momentum to sustain amid expected inflows from multilateral institutions.

Globally, US dollar remained steady against other currencies, as investors wait for US inflation figures out later on Thursday. The data is expected to reinforce bets that the Federal Reserve will continue to aggressively tighten policy.