Rupee loses momentum, depreciates to settle at 279.12 against US dollar

After three successive gains, the Pakistani rupee reverted to its losing ways against the US dollar, depreciating 0.45% on Wednesday.

As per the State Bank of Pakistan (SBP), the rupee settled at 279.12 against the greenback, a decline of Rs1.25 in the inter-bank market.

The loss comes after the currency settled at 277.87, an appreciation of 0.05% against the US dollar, on Tuesday.

In a key development, the country’s total (domestic and external) debt stock rose to the Rs55-trillion mark at the end of January because of massive borrowing and rupee depreciation.

According to the SBP, the central government’s total debt stock recorded an increase of 15% during the first seven months of current fiscal year (FY23).

Pakistan, currently battling rising debt and its repayments, remains engaged with the International Monetary Fund (IMF) over revival of its stalled bailout programme.

Globally, the dollar scaled multi-month highs against most other major currencies on Wednesday after Federal Reserve Chair Jerome Powell warned that US interest rates might need to go up even faster and higher than expected to rein in stubborn inflation.

Higher rates benefit the dollar by improving its yield and as traders look for safety while global stock markets drop.

The US dollar index rose 0.2% in Asia trade to a more than three-month high of 105.86. Sterling fell marginally to $1.1811, its lowest since late November.

Oil prices, a key indicator of currency parity, steadied on Wednesday as industry data showed an unexpected draw in US crude oil inventories after the market tumbled in the previous session on fears that more aggressive US interest rate hikes would hit demand.

Inter-bank market rates for dollar on Wednesday

BID Rs 279.10

OFFER Rs 282.10

Open-market movement

In the open market, the PKR lost 2 rupees for both buying and selling against USD, closing at 278.00 and 281.00, respectively.

Against Euro, the PKR gained 2 rupees for both buying and selling, closing at 291.00 and 294.00 respectively.

Against UAE Dirham, the PKR lost 10 paisa for both buying and selling, closing at 75.60 and 76.30, respectively.

Against Saudi Riyal, the PKR lost 10 paisa for both buying and selling, closing at 73.60 and 74.30, respectively.

Open-market rates for dollar on Wednesday

BID Rs 278.00

OFFER Rs 281.00