Rupee marginally improves against US dollar

The Pakistani rupee registered marginal improvement against the US dollar, appreciating 0.01% against the US dollar in the inter-bank market on Friday.

At close, the currency settled at 278.13, a gain of Re0.04 against the greenback.

On Thursday, the currency had settled at 278.17 against the greenback.

In a key development, BMI, a Fitch Solutions company, in its report expected that the Pakistani rupee will remain pretty stable over the remainder of the year, which will open up more space for interest rate cuts.

“For the past six months, the Pakistani rupee hovered around PKR 278/USD, and we expect that the rupee will only weaken slightly over the remainder of 2024, slipping to PKR 290/USD.

“Policymakers’ success in cracking down on the parallel market has allowed the currency to be adjusted to a more defensible rate and it would take a substantial shock to disrupt the rupee.”

Globally, the US dollar was steady and poised to snap a two-week losing run on Friday as US labour and manufacturing data kept traders pondering on when and by how much the Federal Reserve would cut rates this year.

The number of Americans filing new applications for unemployment benefits rose more than expected last week, though there was no material shift in the labour market.

The dollar index, which measures the US currency against six rivals, was at 104.21, up from a four-month low of 103.64 it touched on Wednesday.

The index is set for a 0.16% gain for the week after two weeks of losses.

Oil prices, a key indicator of currency parity, fell on Friday as a strong dollar, mixed economic signals and concern over China’s economy weighed on investor sentiment.

Brent crude prices fell by 41 cents, or 0.5%, to $84.70 a barrel by 0650 GMT. US West Texas Intermediate crude futures fell 49 cents, or 0.6%, to $82.33 a barrel.

For the week, Brent was down 0.3%, while WTI was trading marginally higher.

A stronger greenback dampens demand for dollar-denominated oil from buyers holding other currencies.

Inter-bank market rates for dollar on Friday

BID                            Rs 278.13

OFFER                      Rs 278.33

Open-market movement

In the open market, the PKR lost 5 paise for buying and remained unchanged for selling against USD, closing at 279.05 and 280.50, respectively.

Against Euro, the PKR gained 1.28 rupee for buying and 1.29 rupee for selling, closing at 301.28 and 304.24, respectively.

Against UAE Dirham, the PKR gained 1 paisa for both buying and selling, closing at 75.55 and 76.29, respectively.

Against Saudi Riyal, the PKR remained unchanged for both buying and selling, closing at 73.80 and 74.51, respectively.

Open-market rates for dollar on Friday

BID                            Rs 279.05

OFFER                      Rs 280.50