KARACHI:
The State Bank of Pakistan (SBP) on Friday pumped an extraordinary Rs1.4 trillion into the financial system through dual open market operations, aiming to ease a mounting liquidity crunch. The intervention was carried out using both conventional and Shariah-compliant instruments.
In the conventional reverse repo operation, the central bank injected Rs1.037 trillion against bids worth Rs1.150 trillion. Of this, Rs76 billion was accepted at 11.06% for a seven-day tenor, while Rs962 billion was picked up at 11.04% for 13 days, with pro-rata allotment applied where needed.
Simultaneously, the SBP conducted a Shariah-compliant Mudarabah-based operation worth Rs363 billion, accepting all submitted bids including Rs241 billion at 11.14% for seven days and Rs122 billion at 11.13% for 13 days.
On the currency front, the Pakistani rupee extended its winning streak, inching up 0.01% against the US dollar in the interbank market. The local unit closed at 281.90, a gain of two paisa from Thursday’s 281.92. This marked the rupee’s 11th straight session of appreciation and its fifth consecutive weekly advance.
Analysts noted that improved confidence, supported by steady foreign exchange reserves and remittance inflows, has helped the currency maintain momentum. According to Ismail Iqbal Securities, the rupee has risen 0.66% in the ongoing fiscal year, though it remains 1.19% weaker on a calendar-year basis.
Meanwhile, gold prices in Pakistan fell despite a rebound in international markets. The All Pakistan Sarafa Gems and Jewellers Association reported a decline of Rs1,500 per tola, bringing domestic prices to Rs355,700. The rate for 10 grams slipped Rs1,286 to Rs304,955. This came just a day after gold had surged Rs2,000 to settle at Rs357,200 per tola.
Globally, spot gold climbed 0.7% to $3,362.53 per ounce, while US gold futures dipped 0.8% to $3,408.20, according to Reuters. Prices had initially moved in a narrow band due to limited progress on geopolitical concerns, but comments from US Federal Reserve Chair Jerome Powell at the Jackson Hole symposium revived buying interest. Powell suggested that upcoming economic data could justify interest rate cuts as early as September, lifting gold as high as $3,380.
Adnan Agar, Director at Interactive Commodities, said the metal remains range-bound but faces strong resistance at the $3,400 level. “If gold breaks this barrier, the next target is projected around $3,450,” he noted. He added that expectations of lower US interest rates, coupled with ongoing geopolitical risks, continue to support gold’s role as a safe-haven asset, though market volatility is likely to persist in the near term.
