Return or withhold? Indian, Pakistani rupee to be volatile this week ahead of US rate hike
Against the UAE dirham, the value of the Indian rupee was at 21.69 on Tuesday. Check the latest exchange rates here. The weakness in the value of the Indian currency against the US dollar will automatically be reflected in its exchange rate with the UAE dirham, as the currency of the United Arab Emirates is pegged to the dollar.
“There will be some breathing room for the rupiah. It could trade around 79.45-79.80 ahead of the Fed event as we will see more of a consolidation phase,” said Kunal Sodhani, vice -president of the world trade center of the Shinhan Bank, based in South Korea. , told Reuters.
The Pakistani currency is about to hit an all-time high. The rupee is down about 0.4% from 240.375 to the dollar, the all-time low it hit earlier this year. The currency fell more than 8% in September.
Against the UAE dirham, the Pakistani rupee was at 64.50, and forex analysts see it weakening in the coming days as inflation hits its highest level in nearly five decades, while struggling with the aftermath of a series of deadly floods.
“The IMF loan was more sentiment-related and was to be followed by inflows from other friendly countries,” said Sana Tawfik, economist at Arif Habib Ltd. in Karachi, at Bloomberg. “Those things were supposed to materialize, but we’re not seeing an influx yet.”
Besides foreign financing to increase reserves, Pakistan has also sought to suppress currency speculation. According to Finance Minister Miftah Ismail, he is investigating eight banks for currency speculation and selling dollars at around 5-10% above the market rate.