Rupee registers marginal gain against US dollar

The Pakistani rupee registered a marginal gain against the US dollar, appreciating 0.1% in the inter-bank market on Thursday.

At close, the local unit settled at 278.59, a gain of Re0.02 against the greenback.

On Wednesday, the rupee had closed at 278.61 after a loss of Re0.11.

In recent weeks, the domestic currency has largely been around 277-279 against the dollar as Pakistan moves forward with its plan to win a longer and larger International Monetary Fund (IMF) bailout programme.

Internationally, Asian currencies were firm on Thursday against a US dollar knocked by softer-than-expected US inflation, save for the yen which remained squeezed ahead of a Bank of Japan meeting and as US policymakers signalled rates would be kept high for a while yet.

Gains had been larger in the immediate aftermath of the US inflation report, which showed consumer prices flat month-to-month in May against market expectations of a 0.1% rise.

They were pared when the Federal Reserve left the funds rate on hold at 5.25-5.5% and policymakers’ median projection for the number of cuts this year fell to just one, from three in March.

Oil prices, a key indicator of currency parity, slipped on Thursday as investors digested that the US Federal Reserve had likely pushed back an interest rate cut to December and as US crude and fuel stocks rose. Brent crude futures was down 43 cents, or 0.5%, to $82.17 a barrel by 0902 GMT.

West Texas Intermediate (WTI) US crude futures fell 46 cents, or 0.6%, to $78.04.

Both benchmarks had gained nearly 1% in the previous session.

The Federal Reserve held interest rates steady on Wednesday and pushed out the start of rate cuts to perhaps as late as December.

Higher borrowing costs tend to dampen economic growth, and could, by extension, limit oil demand.

Inter-bank market rates for dollar on Thursday

BID                            Rs 278.59

OFFER                      Rs 278.79

Open-market movement

In the open market, the PKR lost 18 paise for buying and 13 paise for selling against USD, closing at 277.66 and 280.25, respectively.

Against Euro, the PKR lost 1.21 rupee for buying and 1.18 rupee for selling, closing at 296.24 and 299.08, respectively.

Against UAE Dirham, the PKR gained 15 paise for buying and 17 paise for selling, closing at 74.84 and 75.56, respectively.

Against Saudi Riyal, the PKR gained 10 paise for both buying and selling, closing at 72.80 and 73.51, respectively.

Open-market rates for dollar on Thursday

BID                            Rs 277.66

OFFER                      Rs 280.25