The Pakistani rupee ended its three-session winning run, closing on Friday with a loss of 0.17% against the US dollar in the inter-bank market, as the greenback consolidated gains in the global markets.
As per the State Bank of Pakistan (SBP), the rupee closed at 218.98 after depreciating Re0.38 against the greenback.
On Thursday, the inflow of funds from the International Monetary Fund (IMF) had helped add to the gains of the Pakistani rupee for the third successive session as it closed at 218.60 after appreciating Re0.15 against the greenback.
However, economic headwinds have continued to engulf Pakistan that reported its Consumer Price Index (CPI) at a multi-decade high of 27.3% on a year-on-year basis in August 2022 from a year earlier, data showed on Thursday, as authorities warned massive flooding in the country could exacerbate already skyrocketing prices.
Moreover, foreign exchange reserves held by the SBP fell $113 million, clocking in at an alarming level of $7.7 billion as of August 26, 2022. The reserves’ position is critical for Pakistan which is desperately seeking dollar inflows to meet its balance-of-payments needs. A low level of reserves caused severe pressure on its currency market with the rupee witnessing its worst monthly performance in July in over 50 years.
Globally, the dollar was headed for its third weekly gain in a row and stood near its highest levels in decades against the euro and yen on Friday, with investors in little mood for selling ahead of US labour data that could bolster the case for aggressive interest rate hikes.
The dollar index made a two-decade top at 109.99 overnight and was last at 109.51.
Meanwhile, oil price, a key determinant of currency parity, climbed on Friday on bets that OPEC+ will discuss output cuts at a meeting on September 5, though benchmarks were on track for a steep weekly decline as fears of China’s COVID-19 curbs and weak global growth weighed on the market.
Inter-bank market rates for dollar on Friday
BID Rs 219
OFFER Rs 220
Open-market movement
In the open market, the PKR lost 3 rupees for both buying and selling against USD, closing at 223 and 225, respectively.
Against Euro, the PKR lost 2 rupees for both buying and selling, closing at 220 and 222 respectively.
Against UAE Dirham, the PKR lost one rupee for both buying and selling, closing at 61 and 61.50, respectively.
Against Saudi Riyal, the PKR lost one rupee for both buying and selling, closing at 59 and 59.50, respectively.
Open-market rates for dollar on Friday
BID Rs 223
OFFER Rs 225