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Rupee slips for fourth day to 278.48 against dollar

Webmaster — Thu, 25 Apr 2024 21:22:46 +0000

KARACHI: Pakistani rupee slipped against the US dollar for the fourth straight session in the inter-bank market with a depreciation of nine paisas on Thursday.
According to data released by the State Bank, the rupee shed around 0.03 percent in value against the dollar over the previous session’s closing value. The data showed that the rupee shed Rs0.09 in value, falling from the last session’s close of Rs278.39 to Rs278.48.
The rupee depreciated by around 37 paisa last week, going down from 277.94 to 278.31 per US dollar. Overall, the rupee has improved by Rs9.81 against the greenback during the current fiscal year 2023-24. The local unit improved by Rs1.16 in March, Rs0.39 in February, Rs2.36 in January and Rs3.31 in December, while it shed Rs3.69 against the US dollar in November after gaining Rs6.26 (+2.23 percent) in the month of October.
Meanwhile, the local unit in the open market was quoted at 278.10 for buying and 280.10 for selling, according to data provided by different exchange companies. The rupee surged against the greenback by Re1 in March and February, Rs2 in January and Rs3.50 in December.
Meanwhile, Federal Minister for Finance and Revenue Muhammad Aurangzeb has said that he expected the foreign exchange reserves held by the SBP to close the current fiscal year at around the $9-10 billion mark. Reserves held by the central bank are currently just over $8 billion despite making a $1-billion bond payment.
In a related development, Pakistan has recorded a foreign direct investment (FDI) of $258.04 million in March, compared to an FDI of $169.91 million in the same period last year, the latest data issued by the SBP showed. Comparison on a month-on-month basis shows that the country reported a direct investment of $131.2m in the previous month. Cumulatively in the first nine months (July-March) of this fiscal year 2023-24, the country fetched an FDI of $1.1 billion against the $1.22 billion attracted in the same period last year. – TLT

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Dollar slips just below Rs300 in interbank market

Webmaster — Tue, 12 Sep 2023 21:23:20 +0000

KARACHI: Pakistani rupee extended gains against the US dollar in the interbank market and appreciated by Rs1.27 (+0.42 percent) on Tuesday.
The State Bank of Pakistan (SBP) said in a tweet that the rupee opened at 301.16 against the dollar in the interbank market and closed at 299.89, showing an appreciation of 0.42 percent. The rupee appreciated against the US dollar in the interbank market by Rs2.52 last week and has appreciated by Rs3.06 during the last two sessions, while it has depreciated by Rs13.90 during the current fiscal year 2023-24, and Rs72.46 in the current year.
Meanwhile in the open market, the rupee was quoted in the range of 297-300 against the dollar in the open market as compared to 295-299 a session earlier. The rupee appreciated by Rs35 in the last six sessions prior to this depreciation.
The market experts termed the depreciation in the dollar’s value as a consequence of the crackdown. They said the measures have stopped the capital flight and there’s now an excess supply of dollars in the market. Moreover, reports of increased vigilance of the Afghan transit trade also contributed to the rupee’s rise, they added. They suggested the government continue with these measures in a sustainable manner to bring further improvement in the rupee’s value.
Last week, caretaker Prime Minister Anwaarul Haq Kakar said a crackdown to prevent cross-border smuggling was initiated across the country. Likewise, interim Interior Minister Sarfraz Bugti reiterated the caretaker government’s resolve on Sunday to take elements involved in smuggling and hoarding to task, including those accumulating dollars.-TLTP

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Dollar closes in on Rs300 in interbank, Rs314 in open markets

Webmaster — Wed, 23 Aug 2023 23:02:35 +0000

KARACHI: Pakistani rupee fell to another all-time low of 299.64 against the US dollar in the interbank market on Wednesday and depreciated by 63 paisas (-0.21 percent).
The State Bank of Pakistan (SBP) said in a tweet that the rupee opened at 299.01 against the dollar in the interbank market and closed at 299.64.
Earlier, the rupee hit all-time lows of 299.01 per dollar a session earlier and 298.93 per dollar on May 11 in the backdrop of a deepening political turmoil and widespread law and order disturbances after former prime minister Imran Khan’s arrest in a case. Interestingly, all these lows were recorded when the former prime minister was/is in jail.
The rupee depreciated by Rs7.27 against the US dollar last week and devalued by Rs3.86 during this week. During the current fiscal year 2023-24, Pakistani rupee has shed Rs13.65 against the US dollar in the interbank market, while it plummeted by Rs72.21 against the greenback in the current year.
Similarly, the local unit depreciated against the greenback in the open market by Rs5 (-1.62 percent). The rupee was quoted in the range of 311-314 against the dollar in the open market as compared to 306-309 a session earlier. In the black market/Hundi, the dollar was traded at Rs328 against Rs323 a session earlier.-TLTP

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Dollar slides after slowing US jobs growth in July

Webmaster — Sat, 05 Aug 2023 20:45:18 +0000

NEW YORK: The dollar fell on Friday, paring almost all the week’s gains, after slowing U.S. jobs growth in July encouraged hopes of a soft economic landing but higher wages suggested the Federal Reserve may need to keep interest rates higher for longer.
The U.S. economy added fewer jobs than expected last month. However, solid wage gains and a drop in unemployment to 3.5% signaled continued tightness in the labor market.
Nonfarm payrolls increased by 187,000 jobs last month, the Labor Department’s survey of households showed, less than a Reuters’ survey of economists who forecast growth of 200,000.
Downward revisions in May and June job growth suggested demand for labor was slowing after the Fed’s hefty rate hikes. But with 1.6 job openings for every unemployed person, the moderation in hiring might indicate companies are failing to find workers.
The softer-than-expected jobs number halted this week’s surge in Treasury yields and stopped the dollar’s recent climb, said Marc Chandler, chief market strategist at Bannockburn Global Forex in New York.
“There’s a short squeeze in the foreign currencies, a bit of a long-dollar liquidation encouraged by a sharp drop in interest rates,” he said. “The dollar’s upside correction is almost over.”
Chandler said next week’s Consumer Price Index (CPI) report could show the first year-over-year rise in inflation since June 2022.
The market was positioned for a blowout number after a private payrolls report and still-low jobless claims data earlier this week, said Kathy Lien, managing editor of 60 Second Investor in New York.
“The case is still for a soft landing at worst,” Lien said. “But all of today’s data leaves the door open for another rate hike from the Federal Reserve.”
The dollar index , a measure of the U.S. currency against six peers, fell 0.4% after climbing on Thursday to 102.84, the highest since July 7. The decline was the dollar’s biggest single-day loss in three weeks.
The U.S. labor market is trending in the right direction, said Marvin Loh, senior global macro strategist at State Street in Boston.

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Dollar loses about Rs10 viz Pakistan’s currency

Webmaster — Thu, 04 Aug 2022 04:05:03 +0000

Dollar loses about Rs10

ISLAMABAD: The Pakistani rupee made its first major recovery of around Rs10 to reach a one-week high of Rs228.50 against the US dollar in the inter-bank market on Wednesday.
The domestic currency had closed at Rs238.38 against the greenback on Tuesday.
Earlier, the rupee had hit an all-time low of Rs239.94 last Thursday (July 28), after depreciating by 13.75% (or Rs31.31) during the prior 10 working days.
The rupee recovered after Pakistan reported that its trade deficit had reduced by almost half to $2.64 billion in July compared to $4.96 billion in June.
The significant reduction in the trade deficit was achieved on the back of a cut in imports, resulting in less demand for the greenback in the local market.
The International Monetary Fund (IMF) has also announced that Pakistan has met all prerequisite conditions for the revival of its loan programme.
Finance Minister Miftah Ismail had stated that the IMF executive board is scheduled to meet on August 24, and it would consider giving final approval for the resumption of the programme.
The approval would be followed by receipt of the next loan tranche of $1.2 billion.
The much-awaited revival would help boost forex reserves, as the programme would also unlock inflows from other multilateral and bilateral creditors.

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Dollar appreciation can bankrupt Pakistan like Sri Lanka: Mian Zahid

Webmaster — Tue, 26 Jul 2022 01:22:24 +0000

KARACHI: Chairman of National Business Group Pakistan, President Pakistan Businessmen and Intellectuals Forum, and All Karachi Industrial Alliance and former Provincial Minister Mian Zahid Hussain on Monday said constant appreciation of the dollar can bankrupt Pakistan like Sri Lanka so all possible steps should be taken to contain it, says a Press release.
The central bank should not play the role of a silent spectator to the depreciation of the rupee while the government should act against the black sheep of the currency market benefitting from uncertainty, he said.
Mian Zahid Hussain said that every passing day is weakening the economy which is worrisome.
Talking to the business community, the veteran business leader said that during the week, the value of the dollar increased by fifteen rupees in three days, which is enough to make the country a banana republic.
He said that a prominent economist of the country has termed the sharp rise in the value of the dollar as a deliberate plan against Pakistan that should be taken into account.
Due to the devaluation of the rupee, Pakistan’s debt and liabilities have increased by several thousand billion rupees, while inflation is setting a new record every day, which has made people’s lives a hell.
The increased value of the dollar is affecting the people and all sectors of the economy, but the manufacturing sector increases the prices immediately, but the people associated with the service sector cannot increase the price of their services immediately, which increases the financial pressure on them.
Mian Zahid Hussain said that as a result of the negative policies of the past several years, Pakistan has become isolated to such an extent that friendly countries are not ready to trust or lend, while important political figures are still far from any political or economic consensus.
He further said that the direction of foreign investment in the country also needs to be corrected because it is also causing shortage of dollars in Pakistan. Most of the foreign capital is invested in the country in water, juice, milk, food, banking and communication sectors which have no significant benefit.
Pakistan should promote foreign investment in technology and value addition to benefit from it, he demanded.
Mian Zahid Hussain said that economy cannot progress as the largest political province of the country is paralyzed for several months due to political reasons.

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Dollar crosses Rs229 in interbank market

Webmaster — Fri, 22 Jul 2022 02:21:49 +0000

ISLAMABAD: The Pakistani rupee further depreciated on Thursday as the US dollar rose above Rs229.98 in the inter-bank market, setting a new record.
As economic challenges for the country increased, the dollar’s meteoric rise continued as commercial banks reportedly resumed lines of credit for oil imports at high costs.
The fresh high of the USD comes in response to the rising demand for the foreign currency, despite a lack of supply in the interbank market.
Explaining the factors behind the significant depreciation of the rupee, the State Bank of Pakistan (SBP) has stated that the current account situation, under the dynamic market-based exchange rate system, corresponds to news of internal uncertainty. This combination has led to fluctuations in the value of the rupee on a daily basis.
The central bank furthered that the dollar’s appreciation is also a result of an aggressive interest rate policy adopted by the United States Federal Reserve to control internal inflation.
Prime Minister Shehbaz Sharif sought an urgent board meeting of the International Monetary Fund (IMF) on Wednesday to approve Pakistan’s request for a bailout package, as the rupee was beaten for the third day in a row due to high political volatility and a pause in major foreign loans inflows.
Chairing a meeting on the rapidly deteriorating external sector situation, Shehbaz directed Finance Minister Miftah Ismail to request the IMF for approval of Pakistan’s loan before going on recess from next month, at least three meeting participants told The Express Tribune.
The prime minister chaired the meeting shortly after Ismail and a senior official of the SBP held separate meetings with journalists in Islamabad to explain the reasons behind a rapid fall in the value of the rupee and jittery markets.
The country is now ready to sell its two LNG-fired power plants to the United Arab Emirates (UAE) at a negotiated price within a few days by cutting down the competitive privatisation process that takes about one and a half years.
The government is also willing to give a seat to the UAE government on its blue-chip companies for another $1 billion to stop the current economic meltdown – that, too, through a government-to-government deal and promulgating a presidential ordinance.

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Dollar gains as Pakistani currency nosedives by Rs5.06 in a day

Webmaster — Mon, 18 Jul 2022 22:50:11 +0000

ISLAMABAD: The Pakistani rupee hit a new low against the US dollar as the currency nosedived Rs5.06 in a single day to Rs216.01 in the inter-bank market on Monday.
Similarly, the Pakistan Stock Exchange (PSX) followed suit and slumped 770 points to a one-year low below 41,000 points.
According to experts, capital markets came under renewed pressure following the emergence of fresh “political and economic uncertainties in Pakistan.”
The widespread win by the Pakistan Tehreek-e-Insaf (PTI) in by-elections in 20 constituencies of the Provincial Assembly in Punjab has altered the country’s political landscape once again.
Such uncertainties may mount pressure on the federal government as early general elections may be on the horizon.
Accordingly, the International Monetary Fund (IMF) may consider delaying the resumption of its $6 billion loan programme in wait for political clarity within the country.
On July 16, the fund announced that Pakistan would receive a $1.17 billion tranche in three to six weeks after the two reached a staff-level agreement.
However, as uncertainty persists and Pakistan’s foreign exchange reserves further deplete to a critically low level of $9.2 billion, a delay in the tranche poses a risk as the country verges on default.

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US dollar rides to two-decade highs as yields rise

Webmaster — Mon, 09 May 2022 22:48:43 +0000

LONDON: The U.S. dollar climbed to a two-decade high on Monday as rising U.S. Treasury yields prompted hedge funds to add to their bullish bets while the Chinese yuan weakened below 6.77 levels after weak trade data.
The latest leg of the dollar’s rise, which began after the Federal Reserve raised interest rates by 50 bps last week, has hit currencies that had previously been immune to broad dollar rallies, including the Australian dollar, the yuan and even cryptocurrencies.
Against a basket of major currencies, the dollar topped 104.19 on Monday for the first time since July 2002, extending its almost 9% rise this year.
While it trimmed gains to 103.87 in mid-London trading on reports of some emerging market central banks intervening to support their currencies, the dollar’s uptrend looked intact, said traders.
“It has been a one-way street all morning with Treasury yields nearing the 3.2% levels and the dollar benefiting from that,” a trader at a European bank in London said.
Treasury yields extended their rise for a third consecutive session with yields on benchmark 10-year debt pushing further above 3% to fresh 3-1/2 years. They have doubled in the past two months.
“It is hard to go against the current momentum for higher yields and U.S. dollar strength in the near term,” Mizuho strategists said in a daily note.
Even though the peak in U.S. interest rates in the current hiking cycle is seen at around 3.5% in mid-2023, the speed of the Federal Reserve’s rate hiking cycle is far greater than its peers at the Bank of England and the European Central Bank.
In the euro zone, recent hawkish comments by policymakers have prompted investors to start repricing rate expectations even though projected rate hikes in Europe will lag the United States by a big margin.
Money markets expect the United States to raise interest rates by another 200 bps during the remainder of the year, taking benchmark rates to nearly 3%, while a projected 92 bps of hikes by the ECB will just take its benchmark deposit rate into positive territory.
The Fed hiked its benchmark funds rate by 50 basis points last week and strong jobs data has reinforced bets on further big hikes, with inflation figures due on Wednesday in focus as the next opportunity for an upside surprise.
Latest weekly positioning data suggests yet more upside for the dollar with net long bets still nearly half below their peak in late 2014.
The growth-sensitive Australian dollar fell 1% to $0.6999, its lowest since February. Sterling and the New Zealand dollar hit 22-month lows, while the euro and yen were barely above recent major troughs.

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Rupee falls to 178.24 against US dollar

Webmaster — Wed, 29 Dec 2021 21:47:34 +0000

KARACHI: Pakistani rupee plunged to 178.24 against the US dollar on Wednesday, recording the 14th all-time lowest level in December.
According to the State Bank of Pakistan, the dollar opened at Rs178.19 in the interbank market and closed at Rs178.24 (-0.03). Within the open market, the rupee was traded at 178/178.50 per dollar.
Overall, the rupee has shed Rs2.52 against the US dollar during the current month. The rupee has depreciated by Rs20.82 during the ongoing fiscal year 2021-22 and Rs18.04 in the current year 2021.
The experts said that the measures taken by the State Bank of Pakistan (SBP) are facilitating local currency to hold its stabilisation mode. They said though the rupee has set 14 lowest levels during the current month, these measures have halted the volatile movements.
They said that the rupee’s overall depreciation against the US dollar has been around 1.44 percent as it devalued from 175.72 to 178.24 during December.
They said that the depreciation in terms of percentage does not present a bleak picture as the year-end demand for the US dollar is keeping the market on its toes. They said that the outlook for the rupee remains weak, as the trend suggests that there is limited room for the rupee to appreciate in the near future.
According to them, the recent depreciation of the local unit is dictated by the International Monetary Fund (IMF) through prior actions and it has nothing to do with macroeconomic fundamentals. They said that pressure has mounted on the rupee in recent weeks, with everything now hinging on whether the government strikes a deal with the IMF over the release of new funds.
On the other hand, the currency dealers said that the dollar’s demand for import and corporate payments remains usually high by the close of a calendar year. They added that foreign entities operating in Pakistan send their profits and dividends to their parent companies abroad by the end of the quarter.
Earlier during this month, the rupee set 13 lowest ever levels against the US dollar. The rupee hit then lowest ever levels of 178.19 on December 28, 178.17 on December 27, 178.15 on December 22, 178.05 on December 21, 178.04 on December 17, 177.98 on December 15, 177.89 on December 13, 177.71 on December 10, 177.61 on December 9, 177.43 on December 8, 176.79 on December 7, 176.77 on December 3, and 176.42 on December 02. – TLTP

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