Rupee continues to depreciate, settles at 222.41

Pakistan’s rupee continued to depreciate against the US dollar, falling 0.22% on Wednesday in the inter-bank market.

As per the State Bank of Pakistan (SBP), the rupee closed at 222.41 after a depreciation of Re0.50.

On Tuesday, the rupee had registered a decline for the third consecutive session, and settled at 221.91 after a fall of Re0.22 or 0.1%.

The fall comes amid reports that the International Monetary Fund (IMF) Staff Mission is expected in Islamabad by the end of the month but the date has not yet been finalised as the Fund wants Pakistan to first make some adjustments.

Owing to uncertainty over IMF review, Pakistan's perceived risk of default, measured by the 5-year credit default swap (CDS), also worsened and hit 75.5%.

Internationally, the US dollar on Wednesday traded just above multi-month lows against most majors as flows that had supported the safe-haven currency slowed after President Joe Biden said a missile that caused an explosion in Poland may not have been fired from Russia.

Biden said early information suggested the blast in Poland may not have been caused by a missile fired from Russia, even as the United States and its NATO allies investigated the blast, which killed two.

The US dollar index, which measures the currency against six peers and weights the euro most heavily, was 0.24% lower at 106.26.

Oil prices, a key indicator of currency parity, rose on Wednesday, erasing earlier losses, after an incident involving a commercial vessel off the coast of Oman, but rising COVID-19 cases in China capped gains.

Inter-bank market rates for dollar on Wednesday

BID Rs 222.50

OFFER Rs 223.50

Open-market movement

In the open market, the PKR lost 1.25 rupees for both buying and selling against USD, closing at 226.75 and 229, respectively.

Against Euro, the PKR lost 50 paisas for both buying and selling, closing at 242 and 244 respectively.

Against UAE Dirham, the PKR lost 10 paisas for buying and 20 paisas for selling, closing at 64.60 and 65.20, respectively.

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

Open-market rates for dollar on Wednesday

BID Rs 226.75

OFFER Rs 229