PAK Rupee Ended its 15-Day Losing Streak Against The US Dollar On A Massive Oil Slump
The Pakistani Rupee (PKR) halted losses against the US Dollar (USD) and posted gains in intraday trading today.
It gained 0.03% against the dollar to close at Rs 239.65 after gaining six paisa in today’s interbank market. The local entity traded at an intraday low of Rs 239,625 against the USD during today’s open market session.
The local unit opened with the opening bell in the green and traded at 10:00 p.m. at 11:00 p.m. By midday, the dollar was down to 239.60 against the rupee. After 14:00, the local unit remained at the 239 level against the main foreign currency before the interbank close.
The rupee ended its 15-day losing streak against the dollar today. However, the country’s reserves continue to decline, with the central bank’s foreign exchange reserves shrinking by $278 million to $8.35 billion as of Sept. 16, 2022, according to SBP data released on Thursday.
The country’s total liquid foreign exchange reserves stood at $14.07 billion as of Thursday, according to SBP. Commercial banks held net foreign exchange reserves of $5.72 billion.
The lack of reserves is negative for the FX market and adds pressure on the rupee, which experienced its worst monthly performance in more than 50 years in July.
However, the economic damage caused by the recent floods, the evolving political crisis, and growing doubts about the country’s ability to meet International Monetary Fund (IMF) targets could create further problems.
Pakistan’s government bonds are traded in the 1950s due to major concerns about its external position and the development of the political crisis. The country faces a long list of problems: deteriorating current account balance, widening trade deficit, monetary pressures, central bank interventions, rising cost pressures, and record flood damage.
Oil prices around the world fell on Friday as demand fears were fueled by rising interest rates and a runaway dollar, despite losses amid Moscow’s scramble to recover from its war with Ukraine and the apparent deadlock on talks to revive the nuclear deal were limited with Iran.
Brent crude fell 3.21% to $87.56 a barrel, while US West Texas Intermediate (WTI) fell 3.511% to $80.56 a barrel.
On Friday, global stocks fell to a two-year low while the dollar index touched a 20-year high, putting downward pressure on oil markets.
On the supply side, efforts to revive Iran’s 2015 nuclear deal have stalled as Tehran insists it end investigations by the United Nations nuclear regulator, according to a senior official in the foreign minister’s department, fueling hopes of a revival of Iran’s nuclear deal Crude oil exports dampened.
The PKR reversed its losses against the other major currencies in today’s interbank market. He gained 1 paisa against the United Arab Emirates dirham (AED) and 1.13 rupees against the Canadian dollar (CAD). 1.30 rupees against the Australian Dollar (AUD), 2.57 rupees against the Euro (EUR), and 3.69 rupees against the British Pound (GBP).
Conversely, it lost one paisa against the Saudi riyal (SAR) in today’s interbank foreign exchange market.