The Pakistani rupee, which had seen 28 consecutive days of gains against the US dollar, experienced a slight correction on Tuesday. It fell by Re0.2 or 0.07% in the interbank market, closing at 277.03 compared to the previous day’s rate of 276.83, according to the State Bank of Pakistan (SBP).

Since September 5, the rupee had appreciated by 10.9% or Rs30.3 against the US dollar, driven by strong inflows from exporters and their continuous dollar sales in anticipation of further rupee appreciation. Exporters also engaged in dollar sales in the forward market.

Samiullah Tariq, Head of Research at Pakistan-Kuwait, agreed that the rupee’s decline was a correction.

Arif Habib Limited (AHL) Head of Research, Tahir Abbas, noted that a correction was expected due to the rupee’s consistent appreciation. He also highlighted that the future movement of the rupee would depend on Pakistan’s International Monetary Fund (IMF) review scheduled for November, along with multilateral inflows, imports, and remittances trends.

Head of Equities at Intermarket Securities, Raza Jafri, suggested that the rupee might consolidate around current levels. Meaningful inflows could potentially lead to further appreciation, but he noted that based on the Real Effective Exchange Rate (REER) alone, the currency appeared to be fairly valued for the time being.

The IMF had approved a nine-month $3 billion Stand-By Arrangement (SBA) for Pakistan in July to support economic stabilization. The rupee’s movement may depend on the outcomes of the quarterly reviews, with the first review set for November.