US dollar plunges to eight-month low

12:58 PM | 15 Nov, 2020
US dollar plunges to eight-month low

KARACHI – Pakistan Rupee is strengthening further against the USD as dollar kept falling to an eight-month low in the open market.

The USD in the open market fell below Rs158 on Saturday but in the inter-bank.

According to the President Forex Association of Pakistan Malik Bostan, the uncertainty surface after US polls which destabilized the dollar globally.

During the week, dollar inflows remained high creating a surplus in the open market. As per reports, exchange companies are depositing $12 million into the banks every day.

Currency dealers and experts predict a further appreciation of the rupee against the dollar. The local currency has gained due to higher remittances and impact of Covid-19 on global markets. The rising cases of Covid-19 in the US, Europe and Pakistan could reduce exports earnings.

Dealer’s said local currency is in the overbought territory, the upside of going long in the rupee now is fairly limited.

Any further rupee strengthening will accelerate imports, which is a thinly traded market and in a low GDP growth scenario, could be lethal.