15th successive decline: rupee falters against US dollar

Pakistan’s rupee registered a loss against the US dollar for the 15th successive session, depreciating 0.21% in the inter-bank market on Tuesday.

As per the State Bank of Pakistan (SBP), the rupee declined by Re0.47 to close at 227.88. During the ongoing fiscal year, the rupee has depreciated 10.14% against the greenback.

On Monday, the rupee had registered a loss for the fourteenth successive session against the US dollar to settle at 227.41 after a decrease of Re0.27 or 0.12%.

In a key development on Monday, Pakistan managed to secure over $10 billion in pledges from international financial institutions, donor agencies and development partners for the rehabilitation, recovery and reconstruction of flood-affected areas, during a conference in Geneva.

The major pledges made at the conference, co-hosted by Pakistan and the United Nations, included $4.2 billion from the Islamic Development Bank (IsDB), $2 billion from the World Bank, $1.5 billion from the Asian Development Bank (ADB), $1 billion from the Asian Infrastructure Investment Bank (AIIB) and $1 billion from Saudi Arabia.

Economic experts said the development has reduced risk of default and there is expectation this will bring some stability to the currency market.

Globally, the US dollar languished near a seven-month low against other major currencies on Tuesday, as investors took heart that the Federal Reserve may be nearing the end of its rate-hike cycle and as China’s reopening drove demand for riskier assets.

Markets have grown increasingly doubtful that the Fed will have to take interest rates above 5% to cool inflation, as effects of its aggressive rate increases last year have already been felt in the economy.

Against a basket of currencies, the US dollar index edged 0.04% higher to 103.21, after tumbling 0.7% and touching a seven-month low of 102.93 in the previous session.

Oil prices, a key indicator of currency parity, edged lower on Tuesday on expectations that further interest rate hikes in the US, the world’s biggest oil user, will slow economic growth and limit fuel demand.

Inter-bank market rates for dollar on Tuesday

BID Rs 227.85

OFFER Rs 228.85

Open-market movement

In the open market, the PKR lost 25 paisas for both buying and selling against USD, closing at 234.75 and 237, respectively.

Against Euro, the PKR lost 2.50 rupees for both buying and selling, closing at 270 and 272.50 respectively.

Against UAE Dirham, the PKR remained unchanged for both buying and selling, closing at 68.80 and 69.30, respectively.

Against Saudi Riyal, the PKR remained unchanged for both buying and selling, closing at 66.80 and 67.30, respectively.

Open-market rates for dollar on Tuesday

BID Rs 234.75

OFFER Rs 237