Rupee registers third consecutive gain, settles at 221.42 against US dollar

Pakistan’s rupee registered a gain for the third consecutive session against the US dollar, and appreciated 0.1% in the inter-bank market on Thursday.

As per the State Bank of Pakistan (SBP), the rupee closed at 221.42 after an appreciation of Re0.23.

On Tuesday, rupee had remained firm against the US dollar in the inter-bank market, settling at 221.65 after an appreciation of Re0.01 or 0.01%.

The rupee has remained largely stable in recent days, hovering around the 221-222 level in the inter-bank market even as the US dollar maintained a foothold against other currencies.

In a key development, the federal government decided to withdraw the State Bank of Pakistan (SBP) and the National Bank of Pakistan (NBP)’s appeals from the Supreme Court against Sharia court with respect to making the economy interest-free in the next five years, stated Finance Minister Ishaq Dar.

Moreover, Dar shared that the central bank will receive $500 million from the Asian Infrastructure Investment Bank (AIIB) within this month, another boost to Pakistan’s foreign exchange reserves.

The reserves’ position is critical for Pakistan which has been desperately seeking dollar inflows to meet its balance-of-payments needs.

Internationally, the dollar regained its footing on Thursday ahead of key US inflation data due later in the day, while cryptocurrencies were fragile after a bailout deal for exchange FTX by its bigger rival Binance collapsed.

The dollar has lost some steam over the past few weeks on hopes that the Fed could scale back on its hefty interest rate hikes as soon as December.

Against a basket of currencies, the US dollar index was firm at 110.30, after rising nearly 0.8% overnight.

Oil prices, a key indicator of currency parity, extended losses on Thursday for a fourth consecutive session as renewed COVID curbs in China raised concern about fuel demand in the world’s biggest crude importer.

In the manufacturing hub of Guangzhou, millions of residents were told to get tested for COVID-19 on Wednesday. “Chinese COVID-related demand woes, the reinvigorated dollar and a loose fourth-quarter oil balance could push prices further south,” said Tamas Varga of oil broker PVM.

Inter-bank market rates for dollar on Thursday

BID Rs 221.60

OFFER Rs 222.60

Open-market movement

In the open market, the PKR remained unchanged for both buying and selling against USD, closing at 225.50 and 227.75, respectively.

Against Euro, the PKR gained 50 paisas for both buying and selling, closing at 233.50 and 235.50 respectively.

Against UAE Dirham, the PKR gained 10 paisas for both buying and selling, closing at 64.70 and 65.20, respectively.

Against Saudi Riyal, the PKR gained 20 paisas for buying and 30 paisas for selling, closing at 62.50 and 63, respectively.

Open-market rates for dollar on Thursday

BID Rs 225.50

OFFER Rs 227.75