The Pakistani rupee continued its positive trajectory against the US dollar for the eighth successive session, appreciating 0.3% in the inter-bank market on Friday.

As per the State Bank of Pakistan (SBP), the rupee settled at 280.36 after an increase of Re0.75.

On Thursday, the rupee remained largely flat to settle at 281.11 against the US dollar.

In a key development, the Executive Board of the International Monetary Fund (IMF) completed the first review of Pakistan’s economic reform programme supported by the IMF’s SBA on Thursday. The Board’s decision allows for an immediate disbursement of SDR 528 million (around $700 million), bringing total disbursements under the arrangement to SDR 1.422 billion (about $1.9 billion).

Meanwhile, the foreign exchange reserves held by the State Bank of Pakistan stand at $8.15 billion as of January 5, but are set to get a boost.

Globally, the US dollar held steady against peer currencies on Friday, as investors weighed higher-than-expected US consumer price inflation against market bets that the Federal Reserve will cut rates as soon as March.

US consumer prices increased in December as rents maintained their upward trend, edging 0.3% higher for the month and up an annual 3.4%, versus economists’ forecast in a Reuters poll for a 0.2% gain and 3.2% rise, respectively.

Still, traders are pricing in a 73.2% chance for the first 25 basis point cut to come in March, with several more cuts to follow, according to the CME Group’s FedWatch Tool.

The dollar index was hovering around 102.26, down from Thursday’s high of 102.76 but well ahead of the five-month low of 100.61 hit in December when traders began to aggressively price in a raft of Fed cuts for this year.

Oil prices, a key indicator of currency parity, rose more than 2.5% on Friday as the United States and Britain carried out air and sea strikes on Houthi targets in Yemen in response to attacks by the Iran-backed group on shipping in the Red Sea.

The attack added to market concerns about the potential impact a broader conflict in the Middle East would have on oil supplies from the region, especially those moving through the critical Strait of Hormuz.

Brent crude futures were up $1.95, or 2.5%, at $79.36 a barrel, while US West Texas Intermediate crude futures were $1.99 firmer, or 2.8%, at $74.01, at 0931 GMT.

Each had climbed $2 in earlier trading. On Thursday, the benchmarks rose nearly 1%, pointing to a second straight weekly rise.

Inter-bank market rates for dollar on Friday

BID                           Rs 280.36

OFFER                      Rs 280.56

Open-market movement

In the open market, the PKR gained 52.00 paisa for buying and 44.00 paisa for selling against USD, closing at 279.15 and 281.50, respectively.

Against Euro, the PKR gained 63.00 paisa for buying and 70.00 paisa for selling, closing at 305.59 and 308.40, respectively.

Against UAE Dirham, the PKR gained 31.00 paisa for buying and 29.00 paisa for selling, closing at 75.99 and 76.70, respectively.

Against Saudi Riyal, the PKR gained 6.00 paisa for buying and 5.00 paisa for selling, closing at 74.48 and 75.15, respectively.

Open-market rates for dollar on Friday

BID                           Rs 279.15

OFFER                      Rs 281.50

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