INR & PKR Tumble Amid Central Bank Interventions

Here’s this week’s overview of the Indian Rupee and Pakistani Rupee:

Indian Rupee

The Indian Rupee closed 0.2% weaker at 83.82 against USD last week.

The Rupee fell to its record low despite the recent plunge on the US dollar, aligning with indications that the RBI topped up its already-high foreign currency reserves.

Such a response would be consistent with the central bank’s strategy of intervening in currency markets to limit volatility in the Rupee and prevent the local currency from strengthening against other Asian currencies, to support the competitiveness of Indian goods in export markets.

Pakistani Rupee

PKR ended the week trading 0.1% lower against USD at 278.5. The central bank opted to reduce interest rates by 100bp to 19.5% on Monday last week despite worries over inflation. Inflation figures later in the week showed that price pressures slowed on an annualised basis, but still remain over 10%.