Rupee registers back-to-back gains, settles at 285.99 against US dollar

The Pakistani rupee registered back-to-back gains against the US dollar with an appreciation of 0.25% in the inter-bank market on Tuesday.

At close, the currency settled at 285.99, an increase of Re0.72, as per the State Bank of Pakistan (SBP).

On Monday, the rupee recorded a slight increase against the US dollar, registering an appreciation of 0.01% to settle at 286.71.

In a key development, the Monetary Policy Committee (MPC) of the State Bank of Pakistan (SBP) in its emergency meeting held on Monday decided to increase the benchmark policy rate by 100 basis points (bps) to a record high of 22% on deteriorated inflation outlook followed by imposition of new taxes in the budget.

Cumulatively, the MPC has raised the policy rate by 825bps during this fiscal year (FY23) to control rising inflation.

Separately, Pakistan’s sovereign dollar-denominated bonds jumped on Monday after its parliament approved a revised budget in a last ditch bid to clinch a deal with the International Monetary Fund (IMF).

Globally, the US dollar held its ground against major currencies on Tuesday as tension in Russia simmered and traders looked ahead to US data that may determine the timing of interest rate hikes.

Russian President Vladimir Putin said on Monday he let an aborted mutiny go on as long as it did to avoid bloodshed, a crisis that pushed the greenback to a 15-month high against the rouble.

US data this week include new orders for durable goods, housing figures, and consumer surveys from The Conference Board and University of Michigan.

Market participants expect the Federal Reserve to raise its funds target rate by 25 basis points in July, but the path beyond is less clear.

The global dollar index fell to 102.573 from the previous close of 102.692.

Oil prices, a key indicator of currency parity, slipped on Tuesday ahead of data shedding light on US appetite for fuel during the summer driving season, with the Brent benchmark’s price structure indicating bulls are retreating.

Inter-bank market rates for dollar on Tuesday

BID Rs 285.80

OFFER Rs 286.00

Open-market movement

In the open market, the PKR gained 1 rupee for both buying and selling against USD, closing at 287.00 and 290.00, respectively.

Against Euro, the PKR remained unchanged for both buying and selling, closing at 310.00 and 313.00 respectively.

Against UAE Dirham, the PKR gained 20 paisa for both buying and selling, closing at 78.30 and 79.00, respectively.

Against Saudi Riyal, the PKR gained 30 paisa for buying and 35 paisa for selling, closing at 74.70 and 75.40, respectively.

Open-market rates for dollar on Tuesday

BID Rs 287.00

OFFER Rs 290.00