The Pakistani rupee extended its marginal gains against the US dollar in the interbank market on Wednesday.
The local unit closed the day at 277.20, a gain of Re0.01 against the greenback.
On Tuesday, the Pakistani rupee settled at 277.21 against the dollar.
Globally, the US dollar steadied near its strongest level in two months on Wednesday on prospects of interest rate hikes in the near term, while easing oil prices on hopes for a diplomatic breakthrough to end the Middle East war kept investors on edge.
The euro was at $1.1446 in early trading, loitering near its weakest level since late July. Sterling bought $1.3337. The dollar index, which measures the US currency against six rivals, was at 100.56.
The recent barrage of rate hikes and hawkish rhetoric from major central banks has taken centre stage in currency markets as the US-Israeli conflict with Iran drives oil prices higher and fans inflation worries.
Investors are now anticipating further tightening from central banks, with Federal Reserve officials flagging the possibility of more hikes if inflation does not ease.
Investors are also waiting for a high-stakes meeting between Trump and Chinese President Xi Jinping as the two leaders seek stability in a relationship under pressure over wide-ranging issues.
The Japanese yen was at 157.55 per US dollar as traders remain wary of the threat of intervention as markets judged the Bank of Japan’s rate hike to a 31-year high last week as insufficiently hawkish.
Oil prices, a key indicator of currency parity, held near their lowest in more than two weeks on Wednesday as improving Gulf crude supplies weighed on the market, though diesel refining margins hit a record high on potential restrictions to US diesel exports.
Brent crude futures rose $1.33, or 1.34%, to $100.58 a barrel by 1303 GMT while West Texas Intermediate futures gained 65 cents, or 0.72%, to $91.17.
Inter-bank market rates for dollar on Wednesday
BID Rs 277.20
OFFER Rs 277.40
Open-market movement
In the open market, the PKR gained 2.00 paisa for buying and 4.00 paisa for selling against USD, closing at 278.17 and 279.22, respectively.
Against Euro, the PKR gained 1.18 rupee for buying and 88.00 paisa for selling, closing at 317.45 and 320.75, respectively.
Against UAE Dirham, the PKR remained unchanged for buying and lost 2.00 paisa for selling, closing at 75.70 and 76.29, respectively.
Against Saudi Riyal, the PKR lost 1.00 paisa for both buying and selling, closing at 74.02 and 74.52, respectively.
Open-market rates for dollar on Wednesday
BID Rs 278.17
OFFER Rs 279.22