The Pakistani rupee registered a marginal decline against the US dollar, depreciating 0.02% in the inter-bank market on Tuesday.
At close, the currency settled at 277.74, a loss of Re0.05 against the greenback.
On Monday, the rupee had settled at 277.69, according to the State Bank of Pakistan (SBP).
Internationally, the US dollar clung to a two-and-half-month high on Tuesday on expectations the Federal Reserve will take a measured approach to interest rate cuts, while a close battle in the upcoming US election kept investors on edge.
The dollar’s strength, boosted by rising Treasury yields, kept the pressure on the yen, euro and sterling – a theme that has been building over the past few weeks as data showed the US economy remained in a good place, resulting in traders scaling back their bets of large and rapid rate cuts from the Fed.
Four Federal Reserve policymakers expressed support on Monday for further rate cuts, but appeared to differ on how fast or far they believe any cuts should go.
The diverging views provided a taste of what might be expected at the Fed’s upcoming policy meeting on Nov. 6-7.
Markets are pricing in an 89% chance of the Fed cutting rates by 25 basis points (bps) next month, versus a 50% chance a month earlier, when investors saw an equal likelihood of a larger 50 bps cut, the CME FedWatch tool showed.
Oil prices, a key indicator of currency parity, eased on Tuesday as the top US diplomat renewed efforts to push for a ceasefire in the Middle East and as slowing demand growth in China, the world’s top oil importer, continued to weigh on the market.
Brent crude futures for December delivery were down 60 cents, or 0.8%, at $73.69 a barrel at 0717 GMT.
US West Texas Intermediate crude futures for November delivery were 6 cents lower at $70.50 a barrel on the contract’s last day as the front month.
Inter-bank market rates for dollar on Tuesday
BID Rs 277.74
OFFER Rs 277.94
Open-market movement
In the open market, the PKR lost 11 paise for buying and gained 3 paise for selling against USD, closing at 276.94 and 278.72, respectively.
Against Euro, the PKR gained 1.18 rupee for buying and 1.30 rupee for selling, closing at 299.82 and 302.05, respectively.
Against UAE Dirham, the PKR lost 2 paise for buying and 3 paise for selling, closing at 75.33 and 75.86, respectively.
Against Saudi Riyal, the PKR lost 2 paise for buying and remained unchanged for selling, closing at 73.58 and 74.09, respectively.
Open-market rates for dollar on Tuesday
BID Rs 276.94
OFFER Rs 278.72
American Dollar Exchange Rate