Pakistan’s rupee maintained its downward trend against the US dollar, falling 0.22% in the inter-bank market on Monday.
As per the State Bank of Pakistan (SBP), the rupee closed at 223.66 after a decline of Re0.49. In the last seven trading sessions, the currency has lost Rs2.24 or 1% against the greenback.
During the previous week, the rupee lost value in all five sessions to close at 223.17 against the greenback in the inter-bank market amid reports that talks with the International Monetary Fund (IMF) have been further delayed as the lender linked arrival of its mission in Islamabad with finalisation of macroeconomic framework with necessary adjustments.
The rupee saw somewhat greater pressure towards the end of the week, with investors also concerned over rising domestic political noise and declining foreign exchange reserves.
In a key development, Pakistan’s current account deficit (CAD) clocked in at $0.57 billion in October 2022, against a deficit of $0.36 billion reported in September 2022, registering an increase of over 56%, the central bank said on Monday.
Globally, the US dollar started the week on the frontfoot, boosted by defensive buying as investors remained on edge following a spike in COVID-19 cases in some cities in China that prompted officials to tighten restrictions.
The US dollar index rose 0.131% to 107.030 on Monday, after logging its biggest weekly gain in a month last week, while the offshore Chinese yuan rate was at $7.1700 per dollar.
Markets remain in anticipation of minutes from the Fed's November meeting due to be released on Wednesday that could shed light on how high officials ultimately expect to raise interest rates.
Oil prices, a key indicator of currency parity, dropped to trade near two-month lows on Monday, having earlier slid by around $1 a barrel, as supply fears receded while concerns over fuel demand from China and U.S. dollar strength weighed on prices.
Inter-bank market rates for dollar on Monday
BID Rs 223.75
OFFER Rs 224.75
Open-market movement
In the open market, the PKR lost one rupee for buying and 1.05 rupees for selling against USD, closing at 228.75 and 231, respectively.
Against Euro, the PKR remained unchanged for both buying and selling, closing at 242.50 and 244.50 respectively.
Against UAE Dirham, the PKR lost 30 paisas for both buying and selling, closing at 65.20 and 65.70, respectively.
Against Saudi Riyal, the PKR lost 40 paisas for both buying and selling, closing at 63.20 and 63.70, respectively.
Open-market rates for dollar on Monday
BID Rs 228.75
OFFER Rs 231