Rupee Weakens Amid High Importer Demand

Summary:
On Monday, the Pakistani rupee weakened against the US dollar in the interbank market, closing at 278.5 per dollar compared to the previous 278.37, due to higher demand from importers outstripping exporter sales. In the open market, the rupee remained stable at 280.5. Dealers noted that the local currency is expected to stay range-bound in the near term, influenced by the Pakistan Central Bank’s upcoming interest rate decisions and a potential new loan program with the IMF. Analysts foresee ongoing economic challenges, including high inflation and declining demand, predicting the policy rate to be between 17-19% by December 2024 and the rupee potentially depreciating to 295 by the end of the year and 325 by June 2025.