The rupee also edged lower for a second day as the central bank’s foreign exchange reserves dropped by $303 million to a three-year low of $7.597 billion in the week ending Oct. 7.
According to the SBP, the decline in reserves was brought on by the repayment of foreign debt, including the return of a commercial loan, interest payments, and Eurobonds.
During the week, commercial banks’ reserves decreased by almost $39 million, to reach $5.649 billion. Total reserves for the nation are presently at $13.247 billion, a decrease of $342 million from the previous week.
The SBP had reserves of $7.29 billion at the conclusion of the 2018–19 fiscal year; these reserves rose to $12.13 billion, then to $17.29 billion, and finally to $9.19 billion by the end of the preceding fiscal year.
To close at 218.38 to the dollar on Thursday, the rupee lost 0.23% in the interbank market. Prior to that, the rupee appreciated for 13 consecutive sessions, from 239.71 on September 22 to 217.79 on October 11 – a change of almost Rs22.
On Thursday, the open market price of the local currency was Rs222 versus the dollar, up Rs1.50.
The rupee’s recent recovery is in danger, according to current market analysts, at a time when the finance minister wants it to decline below Rs200 against the dollar.
They anticipate that the local currency will find it difficult to advance in the next few days, especially in light of the global positive trend the dollar is currently experiencing against all major currencies.
However, some important developments on the external front of the economy are expected, such as the deferment of Chinese loans, and inflows from the World Bank, Asian Development Bank, and other credit sources.