Rupee records marginal decline against US dollar

The Pakistani rupee recorded a marginal decline, depreciating 0.04% against the US dollar in the inter-bank market on Thursday.

At close, the local unit settled at 278.20, a fall of Re0.10 against the greenback, as per the State Bank of Pakistan (SBP).

On Wednesday, the rupee closed at 278.10, up by Re0.02.

In a key development, the Petroleum Division proposed a six months’ extension in signing of Pakistan Oil Refining Policy for upgradation of existing/Brownfield refineries as a few refineries are still not ready to sign the policy.

Prime Minister Shehbaz Sharif had also directed the Petroleum Division to arrange the signing ceremony in his presence, but the latter has so far not been successful in firming up the date for the signing ceremony.

Globally, the US dollar held tight ranges against most peers on Thursday as traders awaited key US inflation data for cues on Federal Reserve policy, while the focus on the massive interest rate gap between Japan and the US helped it make some gains on the yen.

Focus swings to the April US producer price index (PPI) and the consumer price index (CPI) out next week, which markets will watch for signs that inflation has resumed its downward trend toward the Fed’s 2% target rate.

The dollar index rose to 0.05% to 105.55, while the Japanese yen was mostly flat at 155.59 per greenback. Sterling was down 0.07% at $1.2487 ahead of the Bank of England’s policy decision later on Thursday.

Oil prices, a key indicator of currency parity, rose on Thursday as falling US crude inventories amid rising refinery intake and a rise in Chinese imports last month supported higher demand expectations for the world’s two largest crude consuming nations.

Brent crude futures for July rose 64 cents, or 0.8%, to $84.22 a barrel by 0812 GMT. US West Texas Intermediate crude for June was up 66 cents, or 0.8% to $79.65 per barrel.

Crude inventories in the US, the world’s biggest oil user, fell last week by 1.4 million barrels to 459.5 million, according to the Energy Information Administration, more than analysts’ expectations for a 1.1 million-barrel draw.

Inter-bank market rates for dollar on Thursday

BID                            Rs 278.20

OFFER                      Rs 278.40

Open-market movement

In the open market, the PKR remained unchanged for buying and gained 3 paisa for selling against USD, closing at 276.57 and 279.11, respectively.

Against Euro, the PKR gained 8 paisa for buying and 6 paisa for selling, closing at 295.11 and 297.87, respectively.

Against UAE Dirham, the PKR remained unchanged for buying and gained 1 paisa for selling, closing at 75.00 and 75.71, respectively.

Against Saudi Riyal, the PKR remained unchanged for buying and lost 1 paisa for selling, closing at 73.30 and 73.97, respectively.

Open-market rates for dollar on Thursday

BID                            Rs 276.57

OFFER                      Rs 279.11