Rupee registers 4th successive gain, settles at 279.85 against US dollar

The rupee maintained its upward trajectory against the US dollar for the fourth successive session, appreciating 0.02% in the inter-bank market on Monday.

As per the State Bank of Pakistan (SBP), the rupee closed at 279.85 after a gain of Re0.05 against the greenback.

In a key development, the caretaker government committed to the International Monetary Fund (IMF) that it would build reserves as conditions permit and let the rupee find its market value as imports are normalised even if pressures re-emerge.

Pakistan in a letter of Intent (LoI), signed and submitted by the caretaker finance minister and governor State Bank of Pakistan to MD IMF, stated that it has initiated structural reforms in the exchange companies sector that will enhance governance and transparency.

In the period ahead, the government will seek to build on the strong programme performance to gradually widen the path to macroeconomic sustainability and lay the conditions for sustained and balanced growth.

During the previous week, the rupee appreciated Re0.46 or 0.16% to settle at 279.9 against the US dollar in the inter-bank market.

It was the tenth consecutive week the local currency gained against the greenback, a momentum on the back of announcement of a staff-level agreement (SLA) between Pakistan and the IMF on the first review of the $3 billion Stand-by Arrangement (SBA), which led to the approval of the second tranche of the package.

Globally, the US dollar struggled to keep gains in early Asian trade on Monday.

The dollar’s trade-weighted index was down 0.07% at 103.19 and flat against the euro at $1.0898.

Its rally so far this year has been tentative and fickle as investors try to make up their minds about when the Federal Reserve will start cutting rates.

Data late last week showing US economic activity remains resilient despite interest rates at their highest level in decades caused markets to scale back expectations of rate cuts beginning as soon as in March.

Oil prices, a key indicator of currency parity, lost more ground on Monday as economic headwinds pressured the global oil demand outlook and offset geopolitical concerns in the Middle East and an attack on a Russian fuel export terminal over the weekend.

Brent crude fell 23 cents, or 0.3%, to $78.33 a barrel by 0732 GMT after settling down 54 cents on Friday.

The front-month US West Texas Intermediate crude futures , for February delivery, were down 28 cents to $73.13 a barrel with the contract set to expire later on Monday.

Inter-bank market rates for dollar on Monday

BID                            Rs 279.85

OFFER                      Rs 280.05

Open-market movement

In the open market, the PKR gained 3.00 paisa for buying and remained unchanged for selling against USD, closing at 278.88 and 281.07, respectively.

Against Euro, the PKR lost 33.00 paisa for buying and 35.00 paisa for selling, closing at 303.69 and 306.53, respectively.

Against UAE Dirham, the PKR lost 1.00 paisa for buying and 2.00 paisa for selling, closing at 76.18 and 76.91, respectively.

Against Saudi Riyal, the PKR gained 1.00 paisa for buying and 8.00 paisa for selling, closing at 74.38 and 75.03, respectively.

Open-market rates for dollar on Monday

BID                            Rs 278.88

OFFER                      Rs 281.07