Rupee registers back-to-back gains against US dollar

The Pakistani rupee closed below the 261 level against the US dollar after an appreciation of 0.37% in the inter-bank market on Thursday.

As per the State Bank of Pakistan (SBP), the rupee settled at 260.93, a gain of Re0.97 against the greenback. This is the rupee’s second successive gain in the inter-bank market.

Earlier, the Pakistani rupee was back to winning ways against the US dollar on Wednesday after it had settled at 261.90 with an appreciation of Re0.61 or 0.23%.

In a key development, Finance Minister Ishaq Dar on Wednesday announced that the Board of China Development Bank has approved the facility of $700 million for Pakistan.

The finance minister announced through a tweet that “this amount is expected to be received this week which will shore up forex reserves”.

Moreover, the government in its bid to correct the fiscal imbalance announced a bunch of austerity measures on Wednesday. The measures were mostly aimed at the cabinet, as Pakistan moved to cut expenditure in the face of severe economic difficulty.

In a related development, President Dr Arif Alvi also approved the Finance (Supplementary) Bill, 2023 that was passed in the National Assembly on Monday and which is crucial to unlock the next tranche of the International Monetary Fund (IMF) loan programme.

Globally, the dollar stood near a seven-week high against the euro and the Aussie on Thursday, as expectations the Federal Reserve is likely to stay on its aggressive rate-hike path, reinforced by minutes from its last policy meeting, set the tone for markets.

Nearly all Fed policymakers favoured a scale-down in the pace of interest rate hikes at the US central bank’s last policy meeting, minutes from the Jan. 31-Feb. 1 FOMC meeting showed on Wednesday.

Against a basket of currencies, the US dollar index stood at 104.50, and was attempting to break a more than one-month peak of 104.67 hit last week.

Oil prices, a key indicator of currency parity, rose slightly in thin Asian trade on Thursday, pausing from a six-day losing streak fed by mounting concerns that more aggressive interest rate increases by central banks could pressure economic growth and fuel demand.

Inter-bank market rates for dollar on Thursday

BID Rs 260.95

OFFER Rs 262.95

Open-market movement

In the open market, the PKR lost 1 rupee for buying and selling against USD, closing at 267.00 and 270.00, respectively.

Against Euro, the PKR gained 2.50 rupee for buying and selling, closing at 278.00 and 281.00 respectively.

Against UAE Dirham, the PKR lost 10 paisa for buying and selling, closing at 73.30 and 74.00, respectively.

Against Saudi Riyal, the PKR gained 60 paisa for buying and selling, closing at 70.10 and 71.80, respectively.

Open-market rates for dollar on Thursday

BID Rs 267

OFFER Rs 270