Rupee largely stable against US dollar

The Pakistani rupee remained largely unchanged against the US dollar in the inter-bank market on Tuesday.

At close, the local unit settled at 279.42 after a fall of Re0.01 against the greenback, as per the State Bank of Pakistan (SBP).

During the previous week, the rupee managed to register another positive week as it gained Re0.18 or 0.06% to settle at 279.41 against the US dollar in the inter-bank market.

It was the 12th consecutive week the local unit appreciated against the greenback. This marginal yet continuous recovery has been on the back of Pakistan advancing with the $3 billion Stand-By Arrangement (SBA) from the International Monetary Fund (IMF).

In a key development, the caretaker government’s team on Monday formally interacted with the IMF) through a video call to seek the latter’s support for tariff rationalization and circular debt reduction plans, well-informed sources told Business Recorder.

Both plans have been developed by two teams dedicated by the caretaker Minister for Power and Petroleum, Muhammad Ali, who intends to get IMF and Federal Cabinet nod, prior to end of the caretakers’ mandate.

The sources said the IMF has sought some clarification from the caretaker government’s team, comprising Ministries of Finance and Energy, which will be responded in a day or two so that things become clearer before the next round.

Internationally, the US dollar was perched near a three-month peak on Tuesday, buoyed by elevated Treasury yields, on growing expectations that the Federal Reserve is unlikely to cut interest rates aggressively this year.

The dollar index, which measures the US currency against six rivals, was at 104.42, having touched 104.60 on Monday, its highest since Nov 14.

The index is up 3% for the year so far after dropping 2% in 2023.

Data on Monday showed US services sector growth picked up in January as new orders increased and employment rebounded, indicating a strong start to the year for the economy and comes after a blowout jobs report last week.

Oil prices, a key indicator of currency parity, held broadly steady on Tuesday as investors waited to see whether a Middle East trip by top US diplomat Antony Blinken would bring a halt to the Gaza war, which has raised concerns about supplies from the major producing region.

Brent crude futures dipped 8 cents to $77.91 a barrel by 0914 GMT, while US West Texas Intermediate crude futures fell 13 cents to $72.65.

Both contracts gained nearly 1% on Monday, rising for the first time in four sessions.

Inter-bank market rates for dollar on Tuesday

BID                            Rs 279.42

OFFER                      Rs 279.62

Open-market movement

In the open market, the PKR gained 3 paisa for both buying and selling against USD, closing at 279.10 and 281.13, respectively.

Against Euro, the PKR gained 1.79 rupees for buying and 1.85 rupees for selling, closing at 299.48 and 302.24, respectively.

Against UAE Dirham, the PKR gained 6 paisa for buying and 5 paisa for selling, closing at 76.22 and 76.95, respectively.

Against Saudi Riyal, the PKR gained 13 paisa for buying and 8 paisa for selling, closing at 74.32 and 74.98, respectively.

Open-market rates for dollar on Tuesday

BID                            Rs 279.10

OFFER                      Rs 281.13