The Pakistani Rupee (PKR) reversed losses against the US Dollar (USD) and posted gains during intraday trade today.
It appreciated by 0.72 percent and closed at Rs. 220.89 after gaining Rs. 1.57 against the greenback. The local unit quoted an intraday low of 222.25 against the greenback.
The local unit was green in the morning against the greenback and resumed trade at 221 in the open market. By 10:15 AM, the greenback went as low as 220.75 against the rupee. By midday, the greenback went as high as 221.95 against the rupee. After 1 PM, the local unit was all green and stayed on the 220 level against the top foreign currency before the interbank close.
The rupee broke its 3-day losing streak against the US Dollar after Finance Minister Ishaq Dar’s plea to forex exchange companies to ensure an appropriate exchange rate. He threatened strict actions against US dollar hoarders and smugglers, as well as manipulators, for keeping the rupee undervalued, and reiterated that the rupee’s fair value is below 200 against the USD.
On the political front, Pakistan’s former prime minister Imran Khan continued his march toward Islamabad in a bid to topple the coalition. Market sentiments continue to rely heavily on the outcome of this situation with analysts suggesting an exchange rate bear in the coming weeks when the federal capital gets completely choked.
Globally, oil prices fell more than $1 on Monday as a result of weaker-than-expected Chinese factory activity data and concerns that the country’s expanding COVID-19 curbs will reduce demand.
At 3:45 PM, Brent crude was down by 0.65 percent at $95.15 per barrel, while the US West Texas Intermediate (WTI) dropped by 0.83 percent to settle at $87.17 per barrel. Overall, Brent and WTI are on track for their first monthly gains since May, up 7.7 percent and 9.3 percent in October so far.
A risk to oil demand comes from Europe, which is expected to enter a recession this winter. Policymakers at the European Central Bank are also sticking to their plans to keep raising interest rates, even if it pushes the bloc into recession and fuels political resentment.
Meanwhile, some of the country’s largest oil producers warned on Friday that productivity and volume gains in the Permian Basin, the country’s top shale field, are slowing. The alarms came just as US oil exports reached a new high last week, helping to push WTI prices up 3.4 percent. Brent gained 2.4 percent last week, marking its second weekly gain in a row.
The PKR was bullish against the other major currencies in the interbank market today. It gained 40 paisas against the Saudi Riyal (SAR), 42 paisas against the UAE Dirham (AED), and Rs. 1.46 against the Canadian Dollar (CAD).
Moreover, it gained 50 paisas against the Pound Sterling (GBP), Rs. 1.21 against the Australian Dollar (AUD), and Rs. 1.87 against the Euro (EUR) in today’s interbank currency market.
