Rupee makes significant strides against US dollar

The Pakistani rupee was up against the US dollar, appreciating 0.79% in the inter-bank market on Tuesday, a day after an official said the government would virtually resume talks with the International Monetary Fund (IMF). However, no update on the IMF front has been officially conveyed yet.

As per the State Bank of Pakistan (SBP), the currency closed at 267.34 against the US dollar, an increase of Rs2.1. The currency has depreciated by 22.5% during the ongoing fiscal year against the greenback.

The gain comes after the rupee had witnessed a marginal decline against the US dollar on Monday, closing at 269.44 against the US dollar, a depreciation of Re0.16 or 0.06%.

During the previous week, however, the currency had appreciated 2.71% against the US dollar to close at Rs269.28 in the inter-bank market.

In a key development, talks between the IMF and Pakistan were set to resume virtually on Monday, a Pakistani official had said, as the two sides look to reach a deal to unlock funding critical to keep the cash-strapped South Asian country afloat.

The two could not reach a deal last week and a visiting IMF delegation departed Islamabad after 10 days of talks, but said negotiations would continue. Pakistan is in dire need of funds as it battles a wrenching economic crisis.

Internationally, the dollar treaded water on Tuesday as investors braced for a highly anticipated inflation report.

Markets are looking to the US consumer price index (CPI) data for further clues on the US Federal Reserve’s policy outlook, with the headline number expected to rise 0.5% in January, according to a Reuters poll, after falling 0.1% in December.

The dollar index, which measures the US currency against six major rivals, eased 0.019% to 103.17, having slipped 0.34% overnight. The index is up 1% for the month of February.

Oil prices, a key indicator of currency parity, dipped on Tuesday after the US government said it would release more crude from its Strategic Petroleum Reserve, while traders look out for US inflation data for further queues.

Inter-bank market rates for dollar on Tuesday

BID Rs 267.30

OFFER Rs 269.30

Open-market movement

In the open market, the PKR gained 2 rupees for buying and selling against USD, closing at 268 and 271, respectively.

Against Euro, the PKR lost 50 paisa for buying and selling, closing at 285.50 and 288.50 respectively.

Against UAE Dirham, the PKR remained unchanged for buying and selling, closing at 74.30 and 75, respectively.

Against Saudi Riyal, the PKR remained unchanged for buying and selling, closing at 71.30 and 72, respectively.

Open-market rates for dollar on Tuesday

BID Rs 268

OFFER Rs 271