Rupee maintains upward trajectory, settles at 221.66 against US dollar

Pakistan’s rupee registered back-to-back gains against the US dollar, and improved 0.12% in the inter-bank market, while the greenback maintained its grip against other currencies on Monday.

As per the State Bank of Pakistan (SBP), the rupee closed at 221.66 after an appreciation of Re0.26.

In the previous week, the rupee had remained largely stable , appreciating 0.25% even as the US dollar strengthened after the Federal Reserve raised its benchmark funds rate by 75 basis points (bps) to 3.75-4% as widely expected.

An increase in SBP's foreign exchange reserves after the receipt of Asian Development Bank’s $1.5-billion loan, and a narrower trade deficit helped the rupee that ended at 221.92 in the inter-bank market on Friday.

However, experts say that the ongoing political noise is likely to have an effect on rupee’s direction with the resumption of the long march by Pakistan Tehreek-e-Insaf (PTI) playing on the minds of investors.

Globally, the dollar looked set to post its best week in over a month on Friday on expectations that US rates could peak higher, while sterling was on the ropes as investors revised their rate projections after a shift in tone from the Bank of England.

Against a basket of currencies, the US dollar index, which measures the greenback against a basket of currencies, firmed to 112.90, after surging 0.8% overnight and touching a roughly two-week high of 113.15.

The index was on track for a weekly gain of 2%, its largest since September.

Oil prices, a key indicator of currency parity, were stable on Monday, hovering close to $100 a barrel as support from a weaker dollar and recovering Chinese crude imports met renewed demand concerns linked to China’s stringent COVID containment approach. Brent crude futures rose by 6 cents, or 0.06% to $98.63 a barrel.

Inter-bank market rates for dollar on Monday

BID Rs 221.70

OFFER Rs 222.70

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 lost 3 rupees for both buying and selling, closing at 234 and 236 respectively.

Against UAE Dirham, the PKR remained unchanged for buying while gaining 10 paisas for selling, closing at 64.80 and 65.30, respectively.

Against Saudi Riyal, the PKR gained 10 paisas for buying and 20 paisas for selling, closing at 62.70 and 63.20, respectively.

Open-market rates for dollar on Monday

BID Rs 225.50

OFFER Rs 227.75