Pakistan’s rupee registered a marginal gain against the US dollar on Friday, and improved 0.01% in the inter-bank market, while the greenback continued to march upwards against other currencies following the US Federal Reserve's rate hike of 75 basis points.
As per the State Bank of Pakistan (SBP), the rupee closed at 221.92 after an appreciation of Re0.03.
On Wednesday, the rupee had settled at 221.95 after a depreciation of Re0.52 or 0.23%.
In a key development, the SBP allowed Exchange Companies to sell 20% of their inward workers’ remittances to customers to meet their demand, while the remaining 80% inward remittances will be surrendered in the inter-bank market, shared Malik Bostan, Chairman, Exchange Companies Association of Pakistan (ECAP).
Bostan said customers are selling in the black market instead of exchange companies as the rate in black market is Rs10 to Rs15 higher.
Moreover, foreign exchange reserves held by the central bank rose by $1.5 billion due to the arrival of inflows from the Asian Development Bank (ADB).
"During the week ended on 28-Oct-2022, SBP’s reserves increased by US$ 1,473 million to US$ 8,912.9 million. This increase is attributed to the receipt of US$ 1,500 million from Asian Development Bank (ADB)," said the SBP.
Internationally, the dollar rose on Thursday, buoyed by a sharp rise in Treasury yields, after the Federal Reserve signaled US interest rates will likely peak above where investors currently expect, while the pound fell ahead of a Bank of England policy meeting.
The Fed on Wednesday had raised its benchmark funds rate by 75 basis points (bps) to 3.75-4% as widely expected.
The US dollar index, which measures the greenback against a basket of currencies, rose 0.5% on the day to 112.70, its highest in a week.
Oil prices, a key indicator of currency parity, slid about 1% on Thursday as an increase in U.S. interest rates pushed up the dollar and heightened fears of a global recession that would crimp fuel demand.
Inter-bank market rates for dollar on Friday
BID Rs 222
OFFER Rs 223
Open-market movement
In the open market, the PKR remained unchanged for both buying and selling against USD, closing at 225.50 and 227.75, respectively.
Against Euro, the PKR gained 2 rupees for both buying and selling, closing at 231 and 233 respectively.
Against UAE Dirham, the PKR gained 20 paisas for buying and 10 paisas for selling, closing at 64.80 and 65.40, respectively.
Against Saudi Riyal, the PKR remained unchanged for buying while losing 10 paisas for selling, closing at 62.80 and 63.40, respectively.
Open-market rates for dollar on Friday
BID Rs 225.50
OFFER Rs 227.75