Pakistan’s rupee sustained minor losses against the US dollar on Monday, as the currency recorded a depreciation of 0.10% in the inter-bank market.

As per the State Bank of Pakistan (SBP), the rupee closed at 223.91 after a decrease of Re0.22.

Rupee remains unchanged against US dollar

During the previous week, the rupee witnessed one of its most stable periods in recent times, appreciating 0.11% in the inter-bank market across the five sessions to settle at 223.95 against the US dollar.

However, worries over informal channels of currency trading gained traction as experts said rampant smuggling and prevalence of a black market was hitting Pakistan’s efforts to reduce volatility in the exchange rate.

At the same time, many believe higher rates offered in the ‘black’ or illegal markets were encouraging remittances to be sent through informal channels.

Fundamentally, the currency remained under pressure as a wider trade deficit – mainly on account of higher imports – was reported with remittances unlikely to compensate when data is revealed later this month.

Globally, the US dollar struggled to gain a foothold on Monday and was languishing at five-month lows as traders looked past stronger than anticipated US jobs data, while growing hopes of China reopening boosted risk sentiment.

The dollar index, which measures the currency against six major peers including the yen and euro, was down 0.18% at 104.28, its lowest since June 28. The index fell 1.4% last week.

Oil prices, a key indicator of currency parity, rose on Monday after OPEC+ nations held their output targets steady ahead of a European Union ban and a G7 price cap which kicked in on Russian crude.

At the same time, in a positive sign for fuel demand in the world’s top oil importer, more Chinese cities eased COVID-19 curbs over the weekend.

Inter-bank market rates for dollar on Monday

BID Rs 224

OFFER Rs 225

Open-market movement

In the open market, the PKR remained unchanged for both buying and selling against USD, closing at 229.25 and 231.50, respectively.

Against Euro, the PKR lost 2.50 rupees for both buying and selling, closing at 251 and 253 respectively.

Against UAE Dirham, the PKR gained 20 paisas for both buying and selling, closing at 65.50 and 66, respectively.

Against Saudi Riyal, the PKR remained unchanged for buying while gaining 10 paisas for selling, closing at 63.30 and 63.70, respectively.

Open-market rates for dollar on Monday

BID Rs 229.25

OFFER Rs 231.50