Rupee's Performance Against US Dollar Since 04 March 2025

The Pakistani rupee registered marginal gain against the US dollar in the inter-bank market on Friday.

At close, the local currency settled at 279.01 against the greenback.

On Wednesday, the local unit closed at 279.02.

Moreover, the dollar on Friday was heading for its largest weekly drop since January as other currencies gained on optimism that a ceasefire in the Gulf will hold and oil shipping will resume.

The euro has rallied through its 200-day moving average this week to trade at $1.1690, a break ​of chart resistance that opens the way to further gains.

The risk-sensitive Australian and New Zealand dollars are ⁠looking at weekly rises of nearly 3% on the dollar, with the Aussie trading just above 70 cents and the kiwi ​at $0.5847.

Sterling has shot up 1.8% this week and above its 200-day moving average to $1.3424.

Globally, oil prices climbed on Friday, with Brent crude futures adding 58 cents, or 0.60%, to $96.50 a barrel as of 0338 GMT.

West Texas Intermediate futures were up 49 cents, 0.50%, at $98.36 a barrel. For this week, both contracts have so far lost 11%, the biggest weekly decline since June 2025.

Similarly, 10-gram gold was sold at Rs426,664 after it increased by Rs2,572, according to rates shared by the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA).

On Thursday, gold price per tola reached Rs494,662 after a decline of Rs9,500 during the day.

The international rate of gold was up by $30 to reach $4,753 per ounce (with a premium of $20).

Meanwhile, the price of silver increased by Rs130 to reach Rs8,014 per tola.

“Pakistan’s economy recovered as growth strengthened and inflation declined in fiscal year 2025 (FY2025, ended 30 June 2025), supported by tight macroeconomic policies and progress in economic reform,” the ADB said in a report today.

According to the Asian Development Outlook (ADO) April 2026, ADB’s annual flagship economic publication, Pakistan was expected to sustain its economic performance in the medium term, with real gross domestic product (GDP) growth forecast at 3.5% in FY2026 and 4.5% in FY2027, from 3.1% in FY2025, as manufacturing recovers and investment increases.

“Pakistan’s economy has stabilised and begun to show stronger momentum, supported by progress in implementing key economic reforms amid a challenging global environment,” said ADB Country Director for Pakistan Emma Fan.

“Growth is expected to continue in 2026 and 2027, but downside risks are significant. Sustained reform efforts are critical to preserve the growth momentum and bolster fiscal and external buffers against global shocks.”

READ MORE: ADB says ready to support new initiatives in Pakistan

The report said that a prolonged Middle East conflict could weigh significantly on the economic outlook by slowing growth through higher energy and fertilizer costs, weakening agricultural and industrial output, “reducing remittances, and widening the current account deficit. Adherence to the economic adjustment program is therefore critical to strengthening resilience and enabling sustainable and inclusive growth”.

As per the report, average inflation was projected to rise to 6.4% in FY2026 and 6.5% in FY2027 due to surging oil prices and disrupted trade routes amid the Middle East conflict.

The central bank is expected to ease monetary policy cautiously to stabilise inflation within its medium-term target range of 5%–7%, said the ADB.

“In FY2026, growth will be supported by a rebound in private-sector investment, driven by the recent progress on reform measures and a stable foreign exchange market.

The effective implementation of the reform program is expected to foster a more stable macroeconomic environment and gradually remove structural barriers to growth.”

READ MORE: ADB, govt sign projects worth USD730m

Economic activity in both industry and services will benefit from monetary easing, and construction activity will be backed by fiscal incentives introduced in the FY2026 budget, alongside post‑flood reconstruction efforts.

Despite recent stabilisation and recovery, Pakistan’s economic outlook faces significant downside risks from global economic uncertainty, leading to elevated inflationary, fiscal, and external account pressures.

Addressing these challenges requires prudent macroeconomic policies and steadfast implementation of structural reforms, the report said.

The five-year contract was awarded by one of Pakistan’s largest banks, the company said in a statement.

It said that this was the second consecutive mandate, following the successful execution of an earlier five-year contract awarded in 2021.

“Under the renewed agreement, Super Secure will deploy an upgraded and more advanced cybersecurity solution aimed at strengthening the bank’s digital infrastructure.

The project includes the implementation of endpoint security systems designed to protect more than 10,000 employees nationwide, addressing one of the most critical areas of cyber risk for financial institutions.”

Supernet said that the contract value falls in the multi-million US dollar range, indicating a significant addition to its cybersecurity revenue pipeline over the next five years.

READ MORE: STL eyes growth with multi-billion pipeline

In addition to this mandate, Super Secure was already engaged with the same client on a three-year privileged access management solution and has previously supported the bank’s international operations through various cybersecurity services, said the statement.

The company stated that the financial impact of the newly awarded contract is expected to remain positive over the life of the agreement, contributing to its long-term growth trajectory.

“Market observers note that repeat contracts of this scale reflect strong client retention and growing demand for advanced cybersecurity solutions within Pakistan’s banking sector, which continues to expand its digital footprint amid rising cyber threats.”

READ MORE: Supernet Technologies completes share allotment after merger

Spot gold was down 0.1% at $4,759.54 per ounce by 0316 GMT.

The metal, however, has gained 1.8% so far this week.

US gold futures for June delivery fell 0.7% to $4,782.70.

The dollar index strengthened, making greenback-priced bullion more expensive for holders of other currencies.

Spot gold has fallen about 10% since the US-Israel conflict with Iran erupted on February 28, with elevated energy prices fuelling inflation concerns and the prospect of higher interest rates.

The fragile two-week ceasefire between the US and Iran showed further strain on Friday, as Washington accused Tehran of breaching promises on the Strait of Hormuz.

Brent crude, however, has slid more than 11% this week on optimism that the ceasefire could reopen the Strait of Hormuz, through which about 20% of the world’s oil and liquefied natural gas passes.

“If things break down, (gold) could end up back in mid-$4,000’s pretty quickly. But if the ceasefire holds and the peace deal starts to look more likely, then we could push through $5,000,” Rodda added.

On the data front, the US Personal Consumption Expenditures index, the Federal Reserve’s preferred inflation gauge, advanced 2.8% in the 12 months through February, in line with estimates, and likely rose further in March.

Investors are now looking out for March’s US Consumer Price Index data, due later in the day, for further clues on Fed’s monetary policy direction.

Markets are pricing in a 31% chance for a US rate cut of at least 25 basis points at the Fed’s December meeting, according to CME’s FedWatch Tool, up from 20% in the prior session.

Among other metals, spot silver rose 0.9% to $75.74 per ounce, platinum lost 2% to $2,061.06, and palladium fell 1.2% to $1,539.43.

At 9:39am, the benchmark index was hovering at 167,688.60 points up by 2,171.09 points or 1.31%.

Moreover, buying was observed in key sectors including chemical, food and personal care products and OMCs.

On Thursday, PSX witnessed a lackluster yet highly volatile trading session, as the index closed slightly lower amid cautious investor sentiment driven by evolving geopolitical developments and sustained uncertainty in global markets.

The benchmark KSE-100 Index declined by 293.50 points or 0.18 percent to close at 165,517.51 points.

Internationally, Asian stocks ticked up early on Friday but gains ​were capped as traders questioned the durability of this week’s US-Iran ceasefire and remained wary of fragile hopes for ‌Israel-Lebanon peace talks.

MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.5%, led by a 1.9% jump for South Korea’s Kospi. Japan’s Nikkei 225 tacked on 1.5%, while S&P 500 e-mini futures reversed ​earlier losses to trade flat.

Prices were still headed for a loss as nerves eased over a fragile two-week ceasefire between the US and Iran, while Israel signalled a potential diplomatic opening, saying it was ready to begin direct talks with Lebanon as soon as possible.

Brent crude futures added 58 cents, or 0.60%, to $96.50 a barrel as of 0338 GMT.

West Texas Intermediate futures were up 49 cents, 0.50%, at $98.36 a barrel. For this week, both contracts have so far lost 11%, the biggest weekly decline since June 2025.

Attacks on Saudi energy facilities have cut the kingdom’s oil production capacity by around 600,000 barrels per day and throughput on its East-West Pipeline by about 700,000 bpd, Saudi state news agency SPA reported on Thursday, citing an official source at the Ministry of Energy.

Concerns of further oil supply disruptions were heightened after the report, ANZ analysts said in a Friday note.

“The initial wave of relief following President Trump’s two-week ceasefire announcement has quickly given way to underlying doubts,” IG market analyst Tony Sycamore said in a note.

“All eyes remain firmly on tanker tracker flows through the Strait of Hormuz for any signs of increased activity ahead of peace talks scheduled in Pakistan on Friday,” Sycamore said. Ship traffic through the strait stood at well below 10% of normal volumes on Thursday despite the ceasefire as Tehran asserted its control by warning ships to keep to its territorial waters while doing so.

Iran and the US agreed on Tuesday to a two-week ceasefire brokered by Pakistan, but fighting was still taking place following the announcement.

Analysts say Pakistan will try to push for a more durable peace agreement but may lack the leverage needed to compel the reopening of the strategic waterway.

Iran wants to charge fees for ships passing through the strait under a peace deal, a Tehran official told Reuters on April 7.

Pakistan working on ceasefires for Lebanon, Yemen: Reuters report

Western leaders and the UN’s shipping agency have pushed back on the idea.

The crucial artery for oil and gas flows has been effectively shut down by the conflict, which began on February 28 when the US and Israel launched air strikes on Iran.

Brent prices could reach $190 a barrel if flows through the Strait of Hormuz remain at the current level, said John Paisie, president of energy consultants Stratas Advisors.

“If Iran allows increasing flows the price of oil will be more moderated, but still well above pre-war levels.”

Saudi Arabia hikes Arab Light crude prices for Asia to record-high premium

Some 50 infrastructure assets in the Gulf have been damaged by drone and missile strikes over the nearly six weeks since the conflict started, and around 2.4 million bpd of oil refining capacity have been taken offline, according to JPMorgan.

The pan-European index was up 0.2% at 613.48 points, as of 0716 GMT, on track to mark its third consecutive weekly rise.

The delicate two-week ceasefire between the US and Iran faced mounting pressure a day before scheduled negotiations in Pakistan on Saturday.

Washington has accused Tehran of violating commitments regarding the Strait of Hormuz, while Israeli strikes in Lebanon, which Iran claims breach the ceasefire terms, have further complicated the diplomatic landscape.

However, Israel signalled a potential diplomatic opening, saying it was ready to begin direct talks with Lebanon as soon as possible, offering a glimmer of hope.

On Friday, healthcare and technology stocks led the gains in Europe, rising 0.5% and 0.6%, respectively.

Meanwhile, energy stocks lost 0.7%, despite rising oil prices on the day.

European stocks jumped on Wednesday, marking their strongest single-day rally in over four years following news of the Middle East ceasefire.

The announcement temporarily calmed investor concerns, allowing the STOXX 600 to recover some losses accumulated since hostilities erupted in late February.

Among other movers, Sodexo slumped 20% after the French food caterer slashed its annual sales and profitability targets.

Looking ahead, market participants will closely scrutinise US inflation data, due later in the day, for insights into how the ongoing conflict might be affecting economic fundamentals.

The stock was on track for its worst day in nearly a month and was set to snap a six-session gaining streak.

It was the third-biggest decliner on the IT index and the benchmark Nifty 50.

The IT index was down 2.2%, even as the Nifty 50 was trading 0.9% higher.

TCS beat fourth-quarter earnings estimates and reported $12 billion in deal wins, but analysts were disappointed by a 2.4% drop in its full-year dollar revenue - its first annual decline since listing.

India’s TCS beats quarterly revenue estimate on AI-led demand

Despite sequential improvement during the quarter, the full-year revenue drop underlined prolonged caution in clients’ technology budgets, said Dolat Capital.

Jefferies analysts echoed the view, saying the results offered limited evidence of any meaningful uptick in demand and that an uncertain growth outlook could drive underperformance in the stock.

U.S.-listed shares of TCS’ smaller rivals Infosys and Wipro also lost nearly 2% overnight.

While TCS’ margins edged up 10 basis points during the quarter, analysts cautioned that upside could be limited.

BOBCaps said higher subcontracting costs, wage hikes and continued investments in AI platforms could cap near-term margin expansion.

TCS shares have slumped nearly 20.5% so far this year, compared with a 19% drop in the IT index, as concerns of AI-led disruption and weak client spending persist. The benchmark Nifty 50 index is down 8.2% year-to-date.

The Federation of Indian Airlines (FIA), which represents top carriers IndiGo, Air India and SpiceJet, has asked India to push Dubai authorities to lift the curbs and, failing that, to consider reciprocal measures on Dubai carriers including Emirates and flydubai, according to a letter it sent to the Indian government on March 31.

Indian carriers are already under financial pressure from higher fuel prices and longer routings to Western destinations because they have been banned from using Pakistani airspace since last year following military tensions between the two neighbours.

In a private email to airlines on March 27, seen by Reuters, Dubai Airports said carriers would be allowed one round trip per day to Dubai International Airport (DXB), normally the world’s busiest international travel hub, and the smaller Al Maktoum International Airport (DWC) during the summer season between April 20 and May 31, extending restrictions implemented after the war began.

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“Carriers continue to be limited to one rotation per day, until capacity allows more to be facilitated … Additional slots will be allocated if capacity is available,” it said.

The FIA told the Indian government the curbs were not being applied to Dubai’s airlines such as Emirates and flydubai, creating an uneven playing field that could lead to “substantial” revenue losses.

Dubai Airports and Dubai’s media office did not respond to repeated requests for comment. Flydubai said its flight schedules were approved by the relevant authorities. Emirates did not respond to a request for comment.

The measures come after Emirates and other Gulf airlines have long complained about India’s bilateral air service agreements that cap the number of seats that can be deployed between countries. Indian authorities have said such pacts protect Indian airlines in the cutthroat market.

Indian carriers hardest hit by caps

India was the largest source of passengers for DXB in 2025, with 11.9 million travellers passing through the hub.

The Dubai caps will hit Indian airlines the hardest, according to April and May schedules data from Cirium.

India’s IndiGo airline names former Air India Express CEO as strategy chief

Air India and its budget carrier Air India Express have scheduled more than 750 flights into DXB in that period. IndiGo has 481, followed by Saudia and Gulf Air, which planned for 480 and 404, respectively. India’s SpiceJet had planned 61.

The one-flight-per-day cap would mean 30 or 31 per month for each foreign airline, versus the hundreds of daily flights being flown by Emirates and flydubai according to Flightradar24 data.

IndiGo told Reuters in a statement that the Middle East crisis and the new Dubai extended restrictions “significantly constrained” its operations as it had an approved summer schedule of 15 daily flights from India to Dubai.

“As a result, a significant portion of IndiGo’s capacity and aircraft time is currently underutilized,” IndiGo said in its first comments on the crisis.

Air India, SpiceJet and Indian authorities did not respond to requests for comment.

Air India Express told Reuters the restrictions had “significantly curtailed” its planned services despite relatively high demand on India-UAE routes, limiting options for travellers, particularly from smaller cities, and underscored the need for a “fair and reciprocal operating framework.”

Other major airlines such as Lufthansa, Singapore Airlines, and British Airways had far fewer flights to Dubai than Indian carriers before the crisis began and have cancelled all flights to the city until at least May 31.

They are instead adding more non-stop Asia-Europe flights to take advantage of strong passenger demand that has pushed up prices.

The Reserve Bank of India on Friday said it will conduct a variable rate reverse repo auction for 2 trillion Indian rupees ($21.58 billion), its first such operation in four months.

The banking system’s liquidity surplus rose to a near four-year high of around 4.5 trillion Indian rupees, or about 1.8% of banks’ deposits on Thursday, pushing the weighted average call rate (WACR) well below the policy repo rate.

In reaction to the announcement, bond yields rose 3-5 basis points, with the benchmark yield briefly touching the 7% mark, while overnight index swap rates rose 7-10 bps from the day’s low.

Overnight rates hovered about 17 bps below the repo rate, prompting the RBI to announce a VRRR. The benchmark bond yield touched 7% as this announcement did not go well with the market after RBI’s remarks just two days ago, said Mataprasad Pandey, vice president at financial advisory firm Arete Capital.

India to push for reporting of offshore Indian rupee trades despite resistance, sources say

“This shows a clear intent to actively absorb surplus liquidity and re-anchor short-term rates closer to the policy rate,” said Kanika Pasricha, chief economic adviser at Union Bank of India.

The choice of a 7-day, rather than overnight absorption, suggests that the RBI views the surplus as more durable than transient, she said.

On Wednesday, the RBI had kept interest rates on hold and said it would continue to ensure sufficient liquidity in the banking system to meet the productive requirements of the economy.

In the monetary policy report, also released on the policy day, the RBI signaled liquidity levels of 0.6% to 1.1% of deposits are desirable to maintain the WACR at a spread of 5-10 basis points below the policy rate.

Benchmark three-month copper on the London Metal Exchange was up 0.5% at $12,742.50 a metric ton by 0930 GMT after touching its highest since March 8 at $12,780. It was set to end the week up more than 3%.

LME copper has gained 9% since March 23, when it sank to the lowest in over three months, on hopes for ending the war in the Middle East, which may damage the global economy and metals demand.

“I don’t think there’s any appetite to try to go long where there’s risk of deterioration ahead of those negotiations in Islamabad,” said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen.

Investors were wary as a fragile two-week ceasefire between the U.S. and Iran showed further strain on Friday, a day before they are to negotiate in Pakistan.

The most-active copper contract on the Shanghai Futures Exchange added 0.6% to close at 98,440 yuan ($14,409.72) a ton, ending the week up 2.1%.

The market was supported by signs of improved demand in China, where copper inventories in warehouses monitored by SHFE fell 11.5% this week, having slid 37% since March 9.

The Yangshan copper premium, which reflects demand for copper imported into China, jumped to $73 a ton, data showed on Friday, its strongest since June last year.

“Even though there’s concern about Iran, the actual numbers on the ground in China points in the other direction, so the market is trying to navigate between those two elements,” Hansen said.

Key technical resistance on the upside is $12,800, based on a retracement from February to March and the 50-day moving average, he added.

Copper prices shrugged off a further increase in LME inventories to their highest since December 2013.

LME aluminium rose 1% to $3,479 a ton as the continued closure of the Strait of Hormuz highlighted supply issues in the Gulf, which accounts for about 8% of global production.

Among other metals, LME zinc dropped 0.7% to $3,305 a ton while nickel gained 0.7% to $17,205, tin advanced 0.8% to $48,050 and lead was flat at $1,927.

The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange was down 108 ringgit, or 2.33%, at 4,535 ringgit ($1,144.05) a metric ton at the close.

The contract fell 6.28% this week, its biggest weekly decline in nearly 16 months.

Malaysia’s palm oil inventories slid in March, down for a third straight month and hitting a seven-month low on a surge in exports that more than offset a modest increase in output.

As we enter the peak production months of April, May, and June, demand destruction caused by the Middle East war and higher freight costs will begin to reflect in the April 1–10 export figures, said Paramalingam Supramaniam, director at brokerage Pelindung Bestari.

“If exports fail to keep pace with the seasonal increase in production, end stocks will inevitably rise again, capping any near-term recovery. Exports must remain robust but looking at the current environment, it is going to be difficult,” he added.

Cargo surveyors estimated that exports of Malaysian palm oil products for April 1-10 fell between 30.7% and 38.9% month-on-month.

Dalian’s most-active soyoil contract rose 0.4%, while its palm oil contract added 0.11%. Soyoil prices on the Chicago Board of Trade were down 0.87%.

Palm oil tracks the price movements of rival edible oils, as it competes for a share of the global vegetable oils market.

Oil prices climbed, driven by fresh anxiety over supplies from Saudi Arabia and as tanker traffic through the critical Strait of Hormuz remained largely frozen.

Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.

In February, the Reserve Bank of India proposed that banks report rupee foreign exchange derivative transactions undertaken globally by their related parties, arguing it would support more efficient price discovery.

The RBI wants lenders to start sharing data on at least 70% of such derivative transactions, starting February 2027.

Domestic banks are already required to report all derivative transactions, including by their overseas offices. Foreign lenders currently only report derivatives traded by their India units and not those executed by offshore ones.

The RBI proposal is aimed at levelling the playing field between Indian and foreign banks, the first source familiar with the central bank’s thinking said.

India central bank opens up term money market for non-banks, companies to boost liquidity

“There was no clarity on what these NDF trades were, making the RBI’s task (of managing the rupee) complicated,” the person said.

Both the sources requested anonymity since they are not authorised to speak to the media.

The RBI did not immediately respond to an email seeking comment.

Offshore market

The large offshore forward market has a significant sway over the rupee’s exchange rate, an influence that has heightened since the RBI opened the market to Indian banks and companies.

Data from the Bank for International Settlements showed that cross-border trades involving the Indian rupee amounted to about $60 billion, or roughly two-thirds of total turnover in the outright forward market, in April 2025.

India’s central bank recently clamped down on trades that sought to benefit from the pricing difference between the NDF and local forwards market. The size of these positions was estimated to be around $40 billion.

Such trades by banks were adding to FX market volatility, RBI Governor Sanjay Malhotra said on Wednesday. The unwinding of the trades has helped lift the rupee to near 92.50 per dollar from an all-time low of near 95.

Push-back from banks

Foreign banks have pushed back against the RBI’s proposal, citing concerns that sharing of the data could breach rules in jurisdictions where the trades take place, according to two senior treasury officials directly aware of the matter.

The claim that reporting requirements are “extra-territorial” does not stand, the second source said, adding that banks licensed to operate in India cannot treat reporting requirements on rupee transactions as outside the central bank’s jurisdiction.

If the RBI presses ahead with the proposal, its implementation could prove challenging, the treasury officials said.

Reporting transactions carried out in other countries would need coordination with other central banks, which could be difficult, one of them said.

The treasury officials declined to be identified since they are not authorised to speak to the media.

The currency ended marginally lower for the day after a choppy session that saw it touch a three-week peak of 92.4150 per dollar before slipping to 92.7550 during the day.

It ended 0.1% lower than its previous close, gaining 0.4% this week.

In recent sessions, the rupee has drawn support from the Reserve Bank of India’s move to impose limits on banks’ onshore FX net open positions, which forced lenders to sell dollars in the local market.

Oil prices dropped after the U.S. and Iran agreed on a two-week truce earlier in the week, easing some concerns about prolonged disruptions to the world’s crude oil supply.

The impact of both these developments is now baked into the current prices, traders said, and the rupee may soon resume its downward trend.

“The cushion that held the rupee steady is beginning to thin, and this is where the story starts to shift,” said Amit Pabari, managing director at FX advisory firm CR Forex.

“Just as domestic support begins to fade, the global backdrop is turning uneasy again.”

The scope for further strength seems limited, with a gradual move towards 93.50–94.00 levels likely on the cards, he added.

Traders also remain cautious about the durability of the U.S.-Iran truce, as reports of continued fighting have kept alive concerns over oil supplies, with the benchmark Brent crude contract trading around $97 per barrel, up from $90 on Wednesday.

Foreign investors continued to remain net sellers of Indian equities, indicating that demand for Indian assets remains weak.

Market participants now await U.S. retail inflation data due later in the day, with interest rate futures showing almost no chance of a rate cut before September.

The Nifty 50 climbed 1.16% to 24,050.6 and the Sensex added 1.2% to 77,550.25, rising nearly 6%, for the week.

U.S. and Iran had reached a two-week ceasefire on Wednesday, pushing Brent crude prices down 12% and providing a respite to equity markets globally.

However, that ceasefire showed signs of strain on Friday as Washington accused Tehran of breaching promises and Israel struck Lebanon.

“A more durable improvement in global risk sentiment would require a cessation of hostilities and the full reopening of the Strait of Hormuz,” said Rita Tahilramani, investment director of Asian equities at Aberdeen Investments.

India imports most of its crude and gas, and soaring energy prices since the war have raised concerns over growth, inflation and the impact on corporate earnings.

The small-cap and mid-cap indexes rose 7.6% and 7.8%, respectively, this week, with all 16 major sectors logging gains.

High-weight financials rose 9%, while auto stocks index was the top gainer among major sectors with a 10.6% surge for the week.

Sectors including tourism, paints, oil marketing companies also rebounded. Larsen & Toubro jumped 9.6% to log its best week in over five years.

Index-heavyweights HDFC Bank and ICICI Bank gained 7.9% and 8.7%, while oil-to-telecom conglomerate Reliance Industries was flat.

Tata Consultancy Services fell 2.5% after a rare annual revenue drop and concerns over a clouded FY27 outlook. It led IT stocks down 1.9% on the day.

Sun Pharma dropped 3.6%, its worst daily drop in about three months, after a report said it plans a $12 billion binding bid for U.S.-based Organon.

The European Bank for Reconstruction and Development (EBRD) said it will “deploy EUR5 billion in 2026 in economies impacted by Middle East conflict”.

The funds would be focused on Iraq, Jordan, Lebanon, the West Bank and Gaza “and affected neighbouring economies” including Egypt, Turkey, Armenia and Azerbaijan, the bank said in a statement.

“The economic and social impact of the conflict is already being felt across many of the bank’s economies in the form of disrupted trade routes, energy and commodity shocks, weakened investor confidence and broader costs to the population,” it added.

Established in 1991 to help former Soviet bloc nations embrace free-market economies, the bank later extended its reach to the Middle East and Africa.

“In a time of rising uncertainty, we are stepping up where others may pull back,” said EBRD president Odile Renaud Basso.

“We are here to support economies, clients and people in our countries of operation in tough times,” she added.

The bank said “the volume of conflict response investment will be demand driven due to the fast-changing nature of the situation”.

Georgieva said the now-paused war was testing the global economy, with a 13 percent cut in the daily flow of the world’s oil and a 20 percent cut in liquefied natural gas triggering a supply shock that had sent energy prices soaring, while disrupting supply chains.

In prepared remarks ahead of next week’s meetings of the IMF and World Bank, Georgieva said the war had prompted the Fund to cut its global growth forecast, echoing a message she shared with Reuters on Monday.

US President Donald Trump on Tuesday announced a two-week ceasefire with Iran, but Israel’s continued bombardment of Lebanon threatens to derail talks to forge a permanent peace.

“Even in a best case, there will be no neat and clean return to the status quo ante,” Georgieva said. Qatar’s Ras Laffan complex, which produces 93 percent of the Gulf’s LNG, for instance, had been shut since March 2 and could take three to five years to return to full capacity.

“The fact is, we don’t truly know what the future holds for transits through the Strait of Hormuz, or for that matter, for the recovery of regional air traffic,” she added. “What we do know is that growth will be slower - even if the new peace is durable.”

The conflict, which began on February 28, would have ripple effects for some time, Georgieva said, including oil refinery shutdowns and refined product shortages that were disrupting transportation, tourism and trade.

Another 45 million people would face food insecurity, bringing the total number of people in hunger to over 360 million. Supply chain disruptions would also continue, given industrial dependencies on inputs such as sulphur, helium for chip-making and naptha for plastics.

Growth forecast downgraded

The IMF will release a range of scenarios in its World Economic Outlook next week, going from a relatively swift normalisation to a scenario that saw oil and gas prices remaining much higher for much longer, Georgieva said.

Even the most hopeful scenario, she said, involved a growth downgrade due to infrastructure damage, supply disruptions, losses of confidence and other scarring effects.

In January, the IMF had forecast global growth of 3.3 percent in 2026 and 3.2 percent in 2027.

Next week’s meetings, which will bring together thousands of finance officials from all over the world, will focus on how to weather the shock of the war, and how the IMF can help its member countries in need, Georgieva said.

She said the IMF was well-resourced and could scale up balance of payments support through existing programs, and additional countries were expected to request aid. She did not identify any specific countries seeking help.

Stocks up, oil prices rise

Stocks rose Friday as investors remained optimistic about the US-Iran ceasefire ahead of planned weekend talks.

Equity markets in Tokyo and Seoul led gains across Asia as investors tracked gains on Wall Street.

But oil prices extended Thursday’s gains – Brent added 0.6 percent and West Texas Intermediate 0.8 percent – as the key Strait of Hormuz remained largely closed. Both main contracts remain around $100 a barrel.

Worries that Israel’s continued attacks on Lebanon could shatter the peace process added to crude-buying sentiment.

Japan to release more oil reserves

Japan’s Prime Minister Sanae Takaichi said Tokyo planned to release a further 20 days’ worth of oil reserves as early as next month.

“To ensure the stable supply of crude oil, we will release starting in early May the equivalent of roughly 20 days’ worth (of oil) from the national reserves,” she said at a meeting held in response to the conflict in the Middle East.

The country began tapping its stockpiles, the world’s largest, in March as the government looked to temper a spike in prices caused by the hit to supply from the conflict.

Trump warns Iran against Hormuz tolls

US President Donald Trump warned Iran against imposing a toll for ships passing through the Strait of Hormuz, after Tehran agreed to reopen the crucial route as part of a two-week ceasefire.

“There are reports that Iran is charging fees to tankers going through the Hormuz Strait – They better not be and, if they are, they better stop now!” Trump said on his Truth Social platform.

In a second message just a few minutes later, Trump added that “very quickly, you’ll see Oil start flowing, with or without the help of Iran”.

Trump, Starmer seek ‘practical plan’ on Hormuz

Trump and British Prime Minister Keir Starmer called for “a practical plan” to get shipping moving again through the Strait of Hormuz following the US-Iran ceasefire, the UK leader’s office said.

The two “agreed that now there is a ceasefire in place and agreement to open the Strait, we are at the next stage of finding a resolution”, according to Downing Street.

“The leaders discussed the need for a practical plan to get shipping moving again as quickly as possible,” and agreed to speak again.

EU rejects Hormuz tolls

The European Union said freedom of navigation in the Strait of Hormuz must be ensured with “no payment or toll whatsoever”, after Iran suggested it could charge for letting ships through the vital Gulf waterway.

“International law provides for the freedom of navigation, which means… basically no payment or toll whatsoever,” said European Commission spokesman Anouar El Anouni. “Freedom of navigation is a public good and needs to be ensured.”

IMF to cut growth forecasts

The International Monetary Fund will lower global growth forecasts because of the war, said managing director Kristalina Georgieva, warning of the conflict’s “scarring effects” despite the fragile ceasefire between the United States and Iran.

Georgieva said the IMF expected to have to provide up to $50 billion in immediate financial assistance to countries affected by the war.

She added that food insecurity because of transport and supply chain disruptions caused by the war was expected to affect at least 45 million people and “even in a best case, there will be no neat and clean return to the status quo ante.”

Non-Iranian tanker crosses Strait

The first non-Iranian oil tanker passed through the Strait of Hormuz since the ceasefire was announced, monitor MarineTraffic showed.

The MSG, a Gabon-flagged oil tanker, passed through the strategic waterway loaded with around 7,000 tonnes of Emirati fuel oil, and is headed to Aegis Pipavav, India, according to the maritime monitor.

Traffic through the crucial shipping lane signals it has not meaningfully reopened since the two-week truce took effect on Wednesday. Just two other tankers – both Iran-flagged – and six bulk carriers have been through the strait since Wednesday, according to MarineTraffic owner Kpler.

Inject gas now

It is “critical” to start building up European gas reserves “as early as possible”, said the continent’s network transmission operator, ENTSOG.

“Europe enters the summer injection season from a much lower storage level than in recent years, at a time when global energy markets and supply are under pressure,” said ENTSOG general director Piotr Kus.

“It is critical to start injecting gas as early as possible, even as early as April, and continue filling until November, to ensure adequate levels for the winter ahead,” he added.

Some comfort

The European development bank said it was unlocking five billion euros ($5.9 billion) to aid economies hit by the Middle East war.

The European Bank for Reconstruction and Development – founded to help former Soviet bloc nations embrace free-market economies before extending its reach to the Middle East and Africa – said it would “deploy 5 billion euros in 2026 in economies impacted by Middle East conflict”.

Air France extends suspensions

Air France has extended the suspension of flights to key destinations in the Middle East until May 3, citing security risks from the war.

A source close to the company said France’s flagship carrier had made the decision to extend the suspensions before Tuesday’s ceasefire announcement.

The yield on the five-year Japanese government bond (JGB) rose 1.5 basis points (bps) to 1.84%, the highest on record.

The benchmark 10-year yield advanced 1 bp to 2.4%, nearing the 27-year high of 2.43% touched earlier in the week.

Yields move inversely to bond prices.

Government bond yields have been rising around the world as the war in Iran, now nearly six-week long, drives oil prices and inflation bets sharply higher.

In Japan, expectations are rising that the government will expand stimulus to support the economy, further straining the country’s already indebted balance sheet.

Benchmark JGB yields fall as signs of Iran ceasefire ease inflation fears

Japan’s wholesale inflation jumped 2.6% in March, data showed on Friday, adding to pressure on the Bank of Japan to accelerate interest rate increases to control prices.

Interest rate swaps on Thursday indicated a 58% chance of a rate hike this month, slightly higher than the day before, according to Tokyo Tanshi data.

“Speculation is likely to grow that the BOJ will soon issue a message if it intends to raise rates in April,” Ataru Okumura, a senior rate strategist at SMBC Nikko Securities, said in a note.

“But given the variable of the war this time around, the BOJ needs to keep its options open until the very end.”

All eyes are on talks in Pakistan this weekend, as the United States and Iran hold their first round of discussions to solidify a fragile ceasefire announced late on Tuesday.

The yield on the 40-year JGB, Japan’s longest tenor, rose 1 bp to 3.88%.

ShengShu said the funding would support development of a “general world model” that processes sensory information to simulate human perception and interaction, which the company describes as a step toward artificial general intelligence in physical environments.

The company did not provide a timeline for when such a system would be commercially available.

Chinese companies ranging from industry giants like ByteDance to startups such as humanoid robot specialist Unitree have begun exploring similar “world model” technologies. ShengShu said the funding round included investments from Andon Haitang, China Internet Investment Fund, TAL Education Group, and Luminous Ventures.

Existing investors LINK-X CAPITAL, Delta Capital, and Baidu Ventures also increased their stakes.

Founded in early 2023 by Tsinghua University alum Zhu Jun, ShengShu became the first Chinese company to release a video generation model when it launched Vidu in April 2024. The model was positioned as a competitor to OpenAI’s Sora, which the US company later discontinued.

ShengShu has since released several updated versions of Vidu, including the Vidu Q3 model announced earlier this year.

The company has also recently expanded into robotics applications.

In December 2025, it open-sourced Motus, a model designed to control robots by processing multimodal data including video and audio.

The startup faces competition from Chinese technology giants including ByteDance, Alibaba and Kuaishou, which have all launched video generation models.

Internationally, companies such as Google and startups including Runway are also developing similar technologies.

January-March revenue of T$1.134 billion compared with T$839.3 billion in the year ago period.

The brief statement gave no other details.

The results topped an LSEG SmartEstimate of T$1.125 billion from 20 analysts, and was in line with TSMC’s January guidance of $34.6 billion to $35.8 billion on its last earnings call. TSMC only gives guidance in US dollars.

TSMC will report full first-quarter earnings on April 16, including an updated outlook for the current quarter and the full year.

The company, whose customers include Nvidia, has been a major beneficiary of advances in AI, which has more than offset a tapering-off in pandemic-led demand for chips used in consumer electronics like tablets.

TSMC’s Taipei-listed shares have gained 29% this year, versus a rise of 22% in the benchmark index. Its shares closed up 2.3% on Friday.

Taiwan’s Foxconn, the world’s largest contract electronics maker and Nvidia’s biggest server maker, has also reported bumper sales, with an-year rise of 30% in first-quarter revenue.

At 0606 GMT the rand traded at 16.42 against the dollar , about 0.1% weaker than its previous close. Despite the modest fall, the risk-sensitive currency was set to end the week more than 3% stronger versus the dollar.

The rand surged on Wednesday after US President Donald Trump announced a two-week ceasefire with Iran and has held most of those gains since. Adam Phillips, treasury specialist at Umkhulu Treasury, said in a morning note that the market mood was “steady but nervous”.

For the rand, “it all centres on (the talks in) Islamabad this weekend,” Phillips added. South Africa will hold its weekly inflation-linked bond auction on Friday, but no major domestic economic data is scheduled for release.

February manufacturing production figures published on Thursday showed the sector was weak before the Iran war.

Africa’s biggest economy had started to build momentum last year and investor confidence was on the rise.

Days before the Middle East conflict erupted the South African government predicted growth would accelerate again this year to 1.6%, but that forecast will probably be revised.‑Reuters

The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange was down 17 ringgit, or 0.37%, at 4,626 ringgit ($1,168.18) a metric ton by the midday break.

The contract has fallen 3.37% so far this week and is set for itsfirst weekly decline in six weeks.

Malaysia’s palm oil stocks droppedlast month, while production increased 7.21% and exports surged 40.69%, Malaysian Palm Oil Board (MPOB) data showed.

As we enter the peak production months of April, May, and June, demand destruction caused by Middle East war and higher freight costs will begin to reflect in the April 1–10 export figures, said Paramalingam Supramaniam, director at brokerage Pelindung Bestari. “If exports fail to keep pace with the seasonal increase in production, end stocks will inevitably rise again, capping any near-term recovery.

Exports must remain robust but looking at the current environment, it is going to be difficult,“ he added. Cargo surveyors are expected to release their estimates of Malaysian palm oil products exports for April 1-10 later in the day.

Dalian’s most-active soyoil contract rose 0.61%, while its palm oil contract added 1.12%. Soyoil prices on the Chicago Board of Trade were up 0.01%.

Palm oil tracks the price movements of rival edible oils, as it competes for a share of the global vegetable oils market.

Oil prices climbed, driven by fresh anxiety over supplies from Saudi Arabia and as tanker traffic through the critical Strait of Hormuz remained largely frozen.

Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.

The benchmark three-month copper on the London Metal Exchange rose 0.29% to $12,718.50 a metric ton as of 0312 GMT, and is set to end the week up near 3%.

The most-active copper contract on the Shanghai Futures Exchange added 0.50% to 98,370 yuan ($14,401.79) a ton, poised to post a near 2% weekly gain.

The Shanghai copper hit an over three-week high at 98,550 yuan a ton earlier this session.

The London copper hit a three-week high on Thursday. Investors are closely watching how Saturday’s negotiations between the US and Iran in Pakistan develop.

The ceasefire announcement on Tuesday sparked a sharp decline in oil prices and helped to ease immediate fears of a deeper hit to global growth.

Iran has cited Israel’s attacks on Lebanon as a key sticking point, while the US has accused Tehran of failing to uphold commitments on oil flows through the strait.

Meanwhile, Chinese inflation data showed that factory-gate prices rose in March for the first time in more than three years, suggesting the conflict is already feeding higher costs into the industrial economy.

China’s producer price index rose 0.5% from a year earlier, ending a 41-month run of declines, while producer prices in non-ferrous metal mining and beneficiation jumped 36.4% and those in non-ferrous smelting and rolling rose 22.4%.

Elsewhere on the LME, aluminium ticked 0.04% higher, nickel added 0.13%, tin advanced 0.45%, zinc dropped 0.36%, and lead dipped 0.13%. Among other SHFE base metals, aluminium added 0.14%, tin rose 1.01%, zinc dropped 0.25%, lead lost 0.75%, nickel tumbled 0.91%.

Crude palm oil production gained 7.21% in March from February to 1.38 million tons, while palm oil exports surged by 40.69% to 1.55 million tons, the industry regulator’s data showed.

A Reuters survey had forecast inventories at 2.18 million tons, with output seen at 1.34 million tons and exports at 1.56 million tons.

The east African country is Africa’s largest exporter of the commodity followed by Ethiopia. Uganda shipped 651,933 60-kilogram bags of the beans in February, according to the report released late Thursday evening.

“Coffee export volumes during the month were higher than February of last year on account of increased coffee production,” the ministry said in the report without giving further details.

In the 12 months to February, Uganda earned $2.5 billion from coffee exports, up from $1.6 billion in the previous period, the ministry said.

China’s factory-gate prices rose for the first time in more than three years in March, an early sign that the war in Iran is feeding cost pressures into the world’s second-largest economy.

“The Middle East conflict put an unexpected but earlier end to China’s industrial deflation in March, despite an overall mixed picture,” Citi analysts said in a note. At the midday break, the benchmark Shanghai Composite index rose 0.63%, while the blue-chip CSI300 Index jumped 1.18%.

Hong Kong’s benchmark Hang Seng Index advanced 0.6%, while tech shares climbed 1.06%.

“The easing of deflationary risk should give policymakers a temporary opportunity to advance the already-planned reform agenda,” said Zhaopeng Xing, senior China strategist at ANZ.

“To mitigate the risk, the anti-involution push remains essential in the near term, in our view. Regulatory tightening will likely resume once the external headwinds subside,” Xing said, noting that domestic demand remained weak.

Brokerage shares led the gains in morning deals as the upbeat inflation data lifted market sentiment, with a sub-index tracking the industry leaping 3.56%.

Middle East tensions remained one of the biggest market focuses.

A fragile US-Iran ceasefire showed further strain on Friday, a day before they are to negotiate in Pakistan, as Washington accused Tehran of breaching promises on the Strait of Hormuz and Israel struck Lebanon with attacks that Iran has claimed violate the truce.

Car exports, an increasingly important source of growth for China’s hyper-competitive auto sector, picked up pace in March despite shipment disruptions from the Middle East crisis.

Separately, market participants said they look to China’s first-quarter gross domestic product and a string of activity indicators next week for more clues on economic health. ‑Reuters

South Korean shares climbed 2% on Friday and were set for their biggest weekly jump in more than 17 years, as renewed optimism over Middle East peace lifted investor sentiment.

The benchmark KOSPI was up 118.34 points, or 2.05%, at 5,896.35, as of 0117 GMT.

The index has climbed 9.7% so far this week, after two consecutive weekly losses.

The benchmark will record its biggest weekly jump since October 2008, if the current momentum holds.

The US State Department will host a meeting next week to discuss ongoing ceasefire negotiations between Israel and Lebanon, a State Department official said late on Thursday.

South Korea’s central bank kept its policy interest rate steady on Friday, maintaining a cautious stance as the conflict in Iran threatens to heat up inflation and weigh on growth in an economy heavily dependent on Middle Eastern energy.

Among index heavyweights, chipmaker Samsung Electronics rose 2.57%, while peer SK Hynix gained 3.81%.

Battery maker LG Energy Solution slid 0.95%.

Shares of Hyundai Motor and sister automaker Kia Corp were up 0.51% and 0.13%, respectively.

Steelmaker POSCO Holdings shed 0.14%, while drugmaker Samsung BioLogics rose 0.32%.

Of the total 912 traded issues, 692 shares advanced, while 179 declined.

Foreigners were net buyers of shares worth 167.4 billion won ($113.25 million).

The won was quoted at 1,478.9 per dollar on the onshore settlement platform, 0.28% lower than its previous close at 1,474.7.

In money and debt markets, June futures on three-year treasury bonds gained 0.06 point to 104.44.

The most liquid three-year Korean treasury bond yield fell 2.5 basis points to 3.316%, while the benchmark 10-year yield fell by 0.6 basis points to 3.654%. ‑Reuters

The Aussie was off a shade at $0.7075, having risen 0.6% overnight to a three-week top of $0.70945.

That brought gains for the week to a hefty 2.8% and continued the wild swings seen the Iran conflict started.

The rally took it well away from the recent trough of $0.6834, but resistance remains at $0.71235 and $0.71875.

The kiwi dollar edged down to $0.5850, after gaining 0.6% overnight to as far as $0.5873.

The rebound left the kiwi up 3.0% for the week, rescuing it from a four-month low of $0.5681.

Resistance lies at $0.5891 and $0.5964.

Both were aided by buying against the Japanese yen, which has lifted the Aussie 2.4% for the week to 112.73.

Australia is a net energy exporter and has a buffer against rising prices, while Japan is a major importer of oil and gas.

The Aussie also has a sizeable yield advantage given the Reserve Bank of Australia has lifted cash rates by 50 basis points to 4.10% this year, and might well hike again in May given inflation had been too high before the spike in energy.

Luci Ellis, chief economist at Westpac, noted there were signs that higher costs were already being passed through by producers, and on a range of goods from food to cement.

“The cost of building a detached home has increased as much as 10%, on our preliminary estimates,” she said.

“The lift in pricing has been widespread across industries and in some cases quite large relative to overall inflation trends.” “If the ceasefire does hold, downside risks to growth diminish and inflation risks ease,” she added.

“But because of the downstream pass-through to other prices the RBA is still likely to raise the cash rate further.”

The Reserve Bank of New Zealand this week warned of much the same threats, with some policy makers favouring a pre-emptive rise in the 2.25% cash rate to head off inflationary pressure.

As a result, markets are pricing in a 65% chance the RBA will hike in May, and an 88% probability the RBNZ will move to 2.5% in July.