PKR continues winning streak against dollar

• Rupee gains 1.16 against greenback in interbank market.
• Local currency closes at Rs227.29 against greenback.
• Economists agree rupee will extend its rise in days to come.

KARACHI: The Pakistan rupee continued to strengthen on Monday in the interbank market, pushing the US dollar's slide for the seventh consecutive session.

The local currency gained Rs1.16, or 0.51%, against the greenback in the interbank market and settled at Rs227.29.

Last week, the unit closed at Rs228.45, according to the data released by the State Bank of Pakistan (SBP).

Finance Minister Ishaq Dar's return and his subsequent comments on the rupee's undervaluation, as well as the likelihood that economic policy will remain stable going forward after he was appointed the finance minister, changed market sentiment from bearish to bullish on the currency.

When Dar stated that strengthening the rupee was his main objective, traders who had been long [on the dollar] started to sell. 

In a similar vein, exporters began selling forwards in considerable sums. The finance minister's warning to speculators to discontinue their activities and the exporters' healthy supplies of dollars helped support the rupee.

The local unit gained 11.2 rupees or 4.9% against the dollar in the interbank market last week, its second-biggest weekly rise since August 5, 2022, when the currency appreciated by 15.3 rupees.

The majority of economists agree the rupee will extend its rise in the days to come as various developments support this forecast.