Indian, Pakistani rupee steady against UAE dirham after attacks
The currencies of Pakistan and India remained relatively stable in comparison to the Emirati Dirham and the US dollar after succumbing to a missile attack by India in thePakistan on Wednesday morning.
On Tuesday, the Indian currency was trading at 23.3 whereas the Pakistani Rupee stood at 76.5 against the Emirati currency, therefore being in a direct conversion with the US dollar.
The exchange rate of the Pakistani currency stood around 281 with the rest of the world while the Indian currency was also boarding around 84.5 with the USD.
Economists mark currency movement as an indicator for armed conflict, and these were the most stagnate moves. Immediately following the sudden attack by India, numerous airlines canceled all flights to Pakistan as the airspace was now completely off limits to commercial airliners, plunging the country into a state of airspace lockdown. Simultaneously, reports suggest that civilians enduring Indian bombardment suffered fatalities alongside loss of five Indian fighter jets claiming sovereignty to attack at will.
Moody's were witnesses to the global financial prospect stating, “Prolonged tensions will impede Pakistan's economy” as the focus shifted turned to core growth challenges for the region.
“Moody's” report notes that “The macroeconomic scenario of Pakistan is on the positive side as growth is gradually picking up, inflation is decreasing and foreign-exchange reserves are improving owing to ongoing progress in the IMF program. Heightened levels of tension for a long time could also constrain Pakistan's external financing capability, placing stress on its foreign exchange reserves which, for the next few years, will remain substantially lower than the value needed to support essential external debt payments.”
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