Back-to-back gains: rupee settles at 279.98 against US dollar

The rupee registered back-to-back gains against the US dollar, appreciating 0.04% in the inter-bank market on Thursday.

As per the State Bank of Pakistan (SBP), the rupee closed at 279.98, a gain of Re0.12 against the greenback.

On Wednesday, the rupee registered a gain as well as it settled at 280.1 against the US dollar, according to the SBP.

A number of positive economic developments on the local front occurred on Wednesday.

The United Arab Emirates (UAE) rolled over its $2 billion deposits with Pakistan for another one year to support the country’s foreign exchange reserves, while the International Monetary Fund (IMF) also released $ 705 million loan tranche to Pakistan, the SBP said.

Pakistan last week requested the UAE for the rollover of $ 2 billion deposits to avert depletion in foreign exchange reserves of the country.

Moreover, the country’s current account posted a surplus of $397 million in December, while foreign direct investment (FDI) surged by 35% in first half of FY24.

Globally, the US dollar held close to a one-month peak versus major peers on Thursday after robust US retail sales data overnight added to building expectations the Federal Reserve will not rush to lower interest rates.

The US dollar index, which measures the currency against a basket of six rivals, traded little changed at 103.36 in the Asian morning, after reaching 103.69 on Wednesday for the first time since Dec. 13.

Traders have trimmed the odds of a first Fed rate cut by March to 53.8%, down from 63.1% on Tuesday, according to CME’s FedWatch Tool.

The market is still pricing in a likely 150 basis points of cuts by the end of the year, even as Fed officials including Governor Christopher Waller this week pushed back against expectations of rapid policy loosening.

Oil prices, a key indicator of currency parity, rose on Thursday as OPEC forecast relatively strong growth in global oil demand over the next two years, while the market also eyed disrupted US oil production amid a cold blast and tensions in the Middle East.

Brent crude futures gained 49 cents, or 0.6%, to $78.37 a barrel by 0740 GMT, while US West Texas Intermediate crude futures rose 70 cents, or 1.0%, to $73.26.

OPEC, in a monthly report, said world oil demand is expected to rise by a robust 1.85 million barrels per day (bpd) in 2025 to 106.21 million bpd.

For 2024, OPEC saw demand growth of 2.25 million bpd, unchanged from its forecast in December.

Inter-bank market rates for dollar on Thursday

BID                            Rs 279.98

OFFER                      Rs 280.18

Open-market movement

In the open market, the PKR lost 8.00 paisa for buying and 2.00 paisa for selling against USD, closing at 278.35 and 280.75, respectively.

Against Euro, the PKR lost 4.00 paisa for buying and 2.00 paisa for selling, closing at 303.04 and 305.98, respectively.

Against UAE Dirham, the PKR lost 7.00 paisa for buying and 5.00 paisa for selling, closing at 76.07 and 76.79, respectively.

Against Saudi Riyal, the PKR lost 1.00 paisa for buying and 3.00 paisa for selling, closing at 74.25 and 74.93, respectively.

Open-market rates for dollar on Thursday

BID                            Rs 278.35

OFFER                      Rs 280.75