The rupee continued its upward trajectory against the dollar, recovering Rs2.36 on Tuesday.

According to rates provided by the State Bank of Pakistan, the dollar fell to Rs161.13, down 1.45 per cent compared to the opening value of Rs163.49.

The latest recovery in the local currency came just a day after US oil futures plunged to historic lows.

“Oil makes a big chunk of Pakistan’s import bill. The crash in oil prices has been a big factor on traders’ minds. Also import volumes have been very low in the last few days,” said Eman Khan of Tresmark.

Due to the lower import volumes, demand for the dollar in the segment has been hit badly. On the other hand, inflows from the International Monetary Fund worth $1.386 billion from last week – aid to fight the adverse impact on the economy from the coronavirus – has increased supply of the greenback.

Moreover, the rupee received further support in the form of slowing foreign hot money outflows in the treasury bills, which in early March had accelerated as part of a broader flight from emerging capital markets.

On Friday (Apr 17) there were net hot money inflows of $190.7m – just a day after the State Bank slashed its interest rates by another 200 basis points to 9pc. But on Monday (Apr 20) foreigners unloaded $11.941 million from T-bills.

Over the past two weeks (since Apr 7), the dollar has dipped by a cumulative Rs6.76 from its peak of Rs167.89.