After four consecutive losses, the Pakistani rupee recorded marginal improvement against the US dollar, appreciating 0.02% in the inter-bank market on Wednesday.
At close, the local unit settled at 279.29, a gain of Re0.06, against the greenback, as per the State Bank of Pakistan (SBP).
On Wednesday, the rupee registered a marginal decline to settle at 279.35 against the US dollar, according to the SBP.
In a key development, the government of Pakistan signed new agreements worth $642 million as commitments in the first quarter of the current fiscal year (July-September) 2023-24, revealed the Economic Affairs Division (EAD) on Wednesday.
Globally, the US dollar plunged to a one-month low against the Japanese yen on Thursday, as growing speculation that the Bank of Japan (BOJ) could end negative interest rates as soon as this month and bets of imminent U.S. rate cuts dragged on the US currency.
In the broader market, the US dollar was on the back foot, as traders zeroed in on the idea that US interest rates were likely to fall this year even after some upside surprises on inflation.
Fed Chair Jerome Powell said on Wednesday rate cuts will “likely be appropriate” later this year “if the economy evolves broadly as expected” and once officials gain more confidence in inflation’s steady deceleration.
Those remarks, coupled with data released the same day that pointed to an easing of labour market conditions, sent US Treasury yields skidding, which in turn pushed the greenback broadly lower.
Oil prices, a key indicator of currency parity, held steady on Thursday, holding onto overnight gains after upbeat Chinese trade data and after US data showed a smaller-than-expected rise in crude inventories and large draws in fuel stocks.
However, expectations that US interest rate cuts could be delayed capped gains.
Brent crude futures slipped 8 cents to $82.88 a barrel by 0736 GMT, while US West Texas Intermediate crude futures inched down 7 cents to $79.06 a barrel despite China’s import and export growth beating estimates.
Inter-bank market rates for dollar on Thursday
BID Rs 279.29
OFFER Rs 279.49
Open-market movement
In the open market, the PKR gained 36.00 paisa for buying and 26.00 paisa for selling against USD, closing at 279.11 and 281.74, respectively.
Against Euro, the PKR lost 99.00 paisa for buying and 1.17 rupee for selling, closing at 303.07 and 305.98, respectively.
Against UAE Dirham, the PKR gained 4.00 paisa for buying and 5.00 paisa for selling, closing at 75.91 and 76.63, respectively.
Against Saudi Riyal, the PKR gained 4.00 paisa for buying and 2.00 paisa for selling, closing at 74.15 and 74.84, respectively.
Open-market rates for dollar on Thursday
BID Rs 279.11
OFFER Rs 281.74