Pakistan's currency remained stable against the US dollar, increasing a marginal 0.01% in the inter-bank market on Wednesday.
As per the State Bank of Pakistan (SBP), the rupee closed at 176.74 against the USD after a day-on-day appreciation of one paisa or 0.01%, and in stark contrast to Tuesday when the currency depreciated 0.14%.
Last week, the PKR had closed at its all-time record low of 178.24 against the USD before appreciating the following two days to end the year at 176.51.
Against USD: Pakistan's rupee opens 2022 with 0.14% fall
The rupee has remained under pressure amid a growing trade deficit, which has added to the current account woes. Pakistan’s trade deficit touched $25 billion during the first half (July-December) of fiscal year 2021-22 as compared to $12.363 billion in the corresponding period of 2020-21.
According to initial foreign trade figures, total imports stood at $39.912 billion during first six months of FY 2021-22 whereas exports were $15.125 billion, showing a difference of almost $25 billion.
The weakening of rupee has also exacerbated inflation in the country, which clocked in at 12.5% in December 2021, nearly a two-year high.
On the international front, the dollar held below two-week highs on Wednesday as traders awaited the release of minutes from the Federal Reserve's December meeting, with growing expectations of a rate hike as early as March keeping the yen pinned near a five-year low.
Inter-bank market rates for dollar on Wednesday
BID Rs 176.70
OFFER Rs 176.80
Open-market movement
In the open market, the PKR remained unchanged for both buying and selling against USD, closing at 178 and 179, respectively.
Against Euro, the PKR lost one rupee for both buying and selling, closing at 200 and 201.50, respectively.
Against UAE Dirham, the PKR lost 9 paisas for buying while remaining unchanged for selling, closing at 49.60 and 50, respectively.
Against Saudi Riyal, the PKR lost 25 paisas for buying and 20 paisas for selling, closing at 46.80 and 47.20, respectively.
Open-market rates for dollar on Wednesday
BID Rs 178
OFFER Rs 179