Rupee registers marginal decline against US dollar

The Pakistani rupee registered a marginal decline, depreciating 0.03% against the US dollar in the inter-bank market on Monday.

At close, the currency settled at 278.64, a loss of Re0.09, against the greenback.

In recent months, the domestic currency has largely been around 277-279 against the dollar as traders have an eye on some strong positive indicators.

During the previous week, the rupee closed with a marginal decline as it lost Re0.05 or 0.02% against the US dollar. The local unit closed at 278.55, against 278.50 it had closed the week earlier against the greenback, according to the State Bank of Pakistan (SBP).

Last week, Finance Minister Muhammad Aurangzeb informed that Pakistan had secured commitments from China, Saudi Arabia and the United Arab Emirates to roll over debt for a year, a major step as Islamabad looks to secure its next bailout with the International Monetary Fund (IMF).

Globally, the yen was a tad softer against the US dollar in trading thinned by a Japanese holiday on Monday, with market participants still ambivalent about the odds of a big Fed rate cut next month.

The respite follows a tumultuous week that began with a massive selloff across currencies and stock markets, driven by worries over the US economy and the Bank of Japan’s hawkishness.

Last week ended calmer, with Thursday’s stronger-than-expected US jobs data leading markets to pare bets for Federal Reserve interest rate cuts this year.

Still, investors remain unconvinced the Fed can afford to go slow with rate cuts, and their pricing of 100 basis points of easing by year end, as per the CME Group’s FedWatch tool, corresponds to a recession scenario.

Oil prices, a key indicator of currency parity, rose for a fifth consecutive session on Monday, extending gains from the previous week’s more than 3% rise, as U.S. recession fears eased and Middle East supply risks provided support.

Brent crude futures were up 70 cents, or 0.9%, at $80.36 a barrel by 1134 GMT while U.S. West Texas Intermediate crude futures rose 84 cents, or 1.1%, to $77.68.

“Support is coming from last week’s better than expected U.S. data, which eased fears of a U.S. recession,” said IG markets analyst Tony Sycamore.

Inter-bank market rates for dollar on Monday

BID                            Rs 278.64

OFFER                      Rs 278.84

Open-market movement

In the open market, the PKR lost 11 paise for buying and remained unchanged for selling against USD, closing at 279.37 and 280.40, respectively.

Against Euro, the PKR lost 27 paise for buying and 6 paise for selling, closing at 304.07 and 305.38, respectively.

Against UAE Dirham, the PKR gained 1 paisa for buying and remained unchanged for selling, closing at 75.90 and 76.35, respectively.

Against Saudi Riyal, the PKR gained 3 paise for buying and remained unchanged for selling, closing at 74.11 and 74.55, respectively.

Open-market rates for dollar on Monday

BID                            Rs 279.37

OFFER                      Rs 280.40