Rupee records gain against US dollar

The Pakistani rupee extended its marginal gains against the US dollar in the interbank market on Wednesday.

The local unit closed the day at 277.36, a gain of Re0.01 against the greenback.

On Tuesday, the Pakistani rupee settled at 277.37 against the dollar.

Internationally, the Japanese yen steadied near its strongest level since February on Wednesday, keeping the dollar on the ‌defensive as traders grappled with oil prices pushing towards $100 per barrel in the face of a widening war in the Middle East.

Houthis in Yemen launched strikes on several Saudi cities, further embroiling a US ally in the over six-month-long conflict, while US forces hit multiple Iranian oil tankers and Iran targeted a US ​base in Jordan.

The reaction in the currency market was to push the dollar modestly lower, although some ​analysts attributed that weakness to the rapid rise of the yen in the past week.

The euro was steady at $1.1631, while sterling last bought $1.3546.

​The dollar index, which measures the US currency against six of its key rivals, was at 98.15, close to its lowest level in almost two weeks.

OCBC strategists said the latest escalation keeps Fed policy implications from higher energy prices in focus, particularly after last week’s strong US payrolls report revived expectations of another ​rate hike.

Oil prices, a key indicator of currency parity, breached $100 a barrel to hit six-week highs on Wednesday as intensifying conflict in the Middle East heightened concerns about oil flows, catching up to physical oil and fuel prices which have passed the psychological threshold already.

Brent crude futures were up $2.77, or 2.83%, at $100.69 a barrel by 1033 GMT, after earlier touching $100.95. US West Texas Intermediate crude was up $2.18, or 2.34%, at $95.21 a barrel, its highest level since early June.

Inter-bank market rates for dollar on Wednesday

BID Rs 277.36

OFFER Rs 277.56

Open-market movement

In the open market, the PKR lost 1 paisa for buying and remained unchanged for selling against USD, closing at 278.22 and 279.06, respectively.

Against Euro, the PKR lost 41 paise for buying and 22 paise for selling, closing at 322.70 and 325.45, respectively.

Against UAE Dirham, the PKR remained unchanged for buying and gained 2 paise for selling, closing at 75.67 and 76.26, respectively.

Against Saudi Riyal, the PKR gained 1 paisa for buying and 2 paise for selling, closing at 73.95 and 74.49, respectively.

Open-market rates for dollar on Wednesday

BID Rs 278.22

OFFER Rs 279.06