Inter-bank market: rupee closes 2023 at 281.86 against US dollar

The Pakistani rupee appreciated marginally against the US dollar for the 13th successive session, gaining 0.02% in the inter-bank market on Friday, the final trading session of 2023.

As per the State Bank of Pakistan (SBP), the rupee settled at 281.86 after an increase of Re0.07.

This means the rupee closed 2023 with a depreciation of 19.7% as it started the year at 226.43 against the US dollar in the inter-bank market.

On Thursday, the rupee had registered a marginal gain to settle at 281.93 against the US dollar.

In a key development, foreign exchange reserves held by the SBP witnessed a significant increase of $852 million on a weekly basis, clocking in at $7.75 billion as of December 22, data released on Thursday showed.

Total liquid foreign reserves held by the country stood at $12.85 billion. Net foreign reserves held by commercial banks stood at $5.1 billion.

The SBP attributed the surge in the reserves to official government inflows.

Internationally, the US dollar looked set on Friday to end 2023 with a loss, reversing two straight years of gains, dragged by market expectations that the US Federal Reserve could begin easing rates as early as next March.

The greenback stayed broadly on the back foot on the last trading day of the year, with currency moves subdued amid a holiday lull leading up to the New Year.

Since the Fed launched its aggressive rate-hike cycle in early 2022, expectations of how far US rates would have to rise have been a huge driver of the dollar for the most part of the past two years.

Against a basket of currencies, the greenback fell 0.02% to 101.18, languishing near a five-month trough of 100.61 hit in the previous session.

The dollar index was on track to lose more than 2% for the month and roughly 2.2% for the year.

Oil prices, a key indicator of currency parity, are set to end 2023 about 10% lower, the first annual decline in two years, after geopolitical concerns, production cuts and global measures to rein in inflation triggered wild fluctuations in prices.

Brent crude futures were up 48 cents, or 0.6%, at $77.63 a barrel at 0523 GMT on Friday, the last trading day of 2023, while the US West Texas Intermediate (WTI) crude futures were trading 37 cents, or 0.5% higher, at $72.14.

On Friday, oil prices stabilised after falling 3% the previous day as more shipping firms prepared to transit the Red Sea route.

Inter-bank market rates for dollar on Friday

BID Rs 281.86

OFFER Rs 282.06

Open-market movement

In the open market, the PKR lost 2.00 paisa for buying and 4.00 paisa for selling against USD, closing at 280.23 and 282.72, respectively.

Against Euro, the PKR gained 1.60 rupee for buying and 1.57 rupee for selling, closing at 307.07 and 310.09, respectively.

Against UAE Dirham, the PKR gained 23.00 paisa for buying and 21.00 paisa for selling, closing at 75.88 and 76.62, respectively.

Against Saudi Riyal, the PKR lost 8.00 paisa for buying and 6.00 paisa for selling, closing at 74.33 and 75.01, respectively.

Open-market rates for dollar on Friday

BID Rs 280.23

OFFER Rs 282.72