The Pakistani rupee registered marginal improvement against the US dollar in the open market on Tuesday, while the local currency maintained its momentum in the inter-bank market as well.
During the day, currency dealers Business Recorder reached out to said the rupee was being quoted at 284 for selling and 281 for buying purposes for customers.
At the end of trading on Tuesday, the currency closed at 284.25 for selling and 281.25 for buying, according to data provided by the Exchange Companies Association of Pakistan (ECAP).
In the inter-bank market, the rupee settled at 283.01 against the greenback.
The gain comes amid improvement in the country’s external account after Pakistan posted a surplus of $9 million in November 2023.
However, the World Bank, in its latest report, ‘Leveraging Diaspora Finances for Private Capital Mobilization’, warned of a drop in remittance flows to Pakistan to $24 billion in 2023 and a further drop below $22 billion with 10% decline in 2024, saying the growing economic turmoil sparked by a balance of payment crisis and high debt have led to a worsening loss of public confidence reflected in a diversion of remittances from formal to informal channels.
“Formal remittance flows plummeted by 20% in 2023 on top of a decline of 5% in 2022. Remittance flows in 2023 are expected to drop to $24 billion”, the World Bank stated.
Remittances are a vital source of foreign exchange reserves for the cash-strapped South Asian country, and a projected decline is expected to keep the currency under pressure in the long term.
