Inter-bank: rupee sustains losses, settles at 285.4 against US dollar

The Pakistani rupee sustained losses against the US dollar, depreciating 0.15% during trading in the inter-bank market on Wednesday, while the open market saw a massive shortage of the greenback.

At close, the currency settled at 285.40, a loss of Re0.44, in the inter-bank market, as per the State Bank of Pakistan (SBP). In the open market, the dollar was being traded in the range of Rs300-305, according to foreign currency dealers.

The development comes after the rupee remained largely unchanged against the US dollar on Tuesday, closing at 284.96 in the inter-bank market.

Meanwhile, it was learnt that Pakistan is to pay 4% annual profit to Saudi Arabia on deposits of $2 billion with the SBP for a period of one year, well-informed sources told Business Recorder.

Saudi Arabia, sources said, had agreed to deposit $2 billion to meet one of the preconditions of International Monetary Fund (IMF) in which Pakistan had been asked to arrange external funding reportedly up to $6 billion.

Separately, for the second consecutive month, Pakistan posted a current account surplus in April 2023 mainly due to a lower import bill.

The SBP on Tuesday reported that the country posted a current account surplus of $18 million for the month of April 23 compared to a deficit of $640 million during April 22. For the second consecutive month, the current account was in surplus; however, the surplus in April is less than the previous month of March, in which the current account posted $750 million.

Internationally, the US dollar was firm on Wednesday, supported by a safety bid as the US hurtled toward its borrowing limit and boosted after solid economic data had traders trimming bets on imminent rate cuts.

The dollar hit a two-week peak of 136.69 yen overnight and hovered just below that at 136.35 early in the Asia session. It also broke above its 50-day moving average against the euro to trade at $1.0866 per euro.

Oil prices, a key indicator of currency parity, were little changed on Wednesday as traders remained cautious after a surprise rise in US crude inventories stoked demand concerns on the heels of weaker-than-expected economic data from the United States and China.