Rupee claws back some ground, settles at 285.74 against US dollar

The Pakistani rupee registered a significant gain against the US dollar, appreciating 0.49% in the inter-bank market on Thursday.

At close, the currency settled at 285.74, a gain of Rs1.39, as per the State Bank of Pakistan (SBP).

The increase comes after the rupee registered a marginal gain against the US dollar to settle at 287.13 or 0.01% on Wednesday.

In a key development, Finance Minister Ishaq Dar reiterated that there is absolutely no risk of default. The finance minister on Wednesday assured the business community that the existing compliant taxpayers would not be further squeezed in the upcoming budget (2023-24) and the focus of the budget would be on broadening the tax base and document new taxpayers.

Dar also assured tax relief measures such as incentives to the poultry sector to bring the commodity prices down in the coming days.

Separately, the National Accounts Committee (NAC) approved 0.29% estimated provisional Gross Domestic Product (GDP) growth rate for the ongoing fiscal year 2022-23 as compared to 6.1% for the last financial year 2021-22.

According to sources, the meeting of the NAC to review the final, revised and provisional estimates of GDP for the years 2020-21, 2021-22 and 2022-23.

The national accounts committee’s latest GDP growth forecast is lower than the World Bank’s estimate of 0.4%, while the IMF said in April that the growth would be 0.5%.

Globally, the US dollar pushed to a two-month high against the euro and a six-month peak versus the yen on Thursday, as a resilient US economy led traders to pare their bets on rate cuts this year.

The greenback has also benefited from demand for safe havens, paradoxically as a US debt ceiling impasse threatens a disastrous default as soon as June 1, when the Treasury has warned it would be unable to pay all its bills.

The US dollar index, which measures the currency against six major peers including the euro and yen, touched a two-month high of 104.01.

Oil prices, a key indicator of currency parity, fell on Thursday after Russian Deputy Prime Minister Alexander Novak played down the prospect of further OPEC+ production cuts at its meeting next week.

Inter-bank market rates for dollar on Thursday

BID Rs 285.75

OFFER Rs 285.95

Open-market movement

In the open market, the PKR remained unchanged for both buying and selling against USD, closing at 306.00 and 309.00, respectively.

Against Euro, the PKR gained 1 rupee for both buying and selling, closing at 329 and 332 respectively.

Against UAE Dirham, the PKR remained unchanged for both buying and selling, closing at 84.20 and 85.00, respectively.

Against Saudi Riyal, the PKR gained 20 paisa for both buying and selling, closing at 82.00 and 82.80, respectively.

Open-market rates for dollar on Thursday

BID Rs 306.00

OFFER Rs 309.00