Rupee largely stable against US dollar

The Pakistani rupee remained largely stable, depreciating 0.01% against the US dollar in the inter-bank market on Thursday.

At close, the local unit settled at 278.44, a loss of Re0.04 against the greenback, as per the State Bank of Pakistan (SBP).

On Wednesday, the rupee had registered a marginal decline to settle at 278.40 against the US dollar, according to the SBP.

In a key development, an IMF official said that despite the tightening of monetary policy over the past two or three years in Pakistan to control inflation, which is projected to come down, more work needs to be done on demand and supply side.

Internationally, the US dollar was soft on Thursday as traders assessed the US interest rates outlook in the wake of comments from Federal Reserve officials that cemented expectation of monetary settings remaining restrictive for a while longer.

The US dollar has been rising in recent weeks as a slew of strong US economic data and persistent inflation dashed expectation of rate cuts in the near term.

Simmering tension in the Middle East also added to the dollar’s safe-asset appeal. Dollar strength has cast a shadow across currency markets, keeping the yen rooted near 34-year lows and leading to several warnings from Japanese authorities as traders fret about possible intervention.

The dollar index, which measures the US currency against six peers, was last at 105.97, inching away from the five-and-a-half-month high of 106.51 hit on Tuesday as traders consolidated positions.

The index is up 4.5% this year.

Oil prices, a key indicator of currency parity, were little changed after a 3% drop in the previous session as the market remains concerned about demand this year and on signs that a wider conflict in the key Middle East producing region could be avoided.

Brent futures were up 13 cents, or 0.15%, at $87.42 a barrel, while US West Texas Intermediate (WTI) crude futures traded 6 cents higher, up 0.07%, at $82.75 a barrel at 0636 GMT.

The two benchmarks slid 3% in the previous session on signs that fuel demand this year is lower than expected amid flagging economic growth in China and as oil inventories in the US, the world’s biggest crude consumer, rose.

Inter-bank market rates for dollar on Thursday

BID                            Rs 278.44

OFFER                      Rs 278.64

Open-market movement

In the open market, the PKR lost 13.00 paisa for buying and 9.00 paisa for selling against USD, closing at 277.20 and 279.66, respectively.

Against Euro, the PKR lost 1.14 rupee for buying and 1.10 rupee for selling, closing at 293.56 and 296.25, respectively.

Against UAE Dirham, the PKR gained 3.00 paisa for buying and 4.00 paisa for selling, closing at 75.10 and 75.80, respectively.

Against Saudi Riyal, the PKR lost 5.00 paisa for buying and 4.00 paisa for selling, closing at 73.23 and 73.91, respectively.

Open-market rates for dollar on Thursday

BID                            Rs 277.20

OFFER                      Rs 279.66