Dollar below 300 after over two weeks

The rupee continued to strengthen against the dollar in the interbank market on Tuesday, rising 0.42 per cent to below 300, a barrier it crossed for the first time ever on Aug 24. According to the State Bank of Pakistan’s data, the rupee closed at 299.89 on Tuesday compared to 301.16 a day ago. In the open market, however, the rupee remained unchanged at 300 to the dollar. The local currency has significantly gained in the past few days, with analysts attributing the rise to an ongoing crackdown on illegal dollar outflows. Currency dealers in the interbank said exporters had been selling dollars on a large scale, fearing further devaluation. However, due to the cheaper dollars, demand has started rising, which may disrupt the government’s plan to bring down the trade and current account deficits. The government has already been following the IMF’s directions to keep the imports open, but the availability of dollars was the main hindrance to imports.