The Pakistani rupee recorded marginal improvement against the US dollar, appreciating 0.07% during the opening hours of trading in the inter-bank market on Tuesday.
At 10am, the currency was hovering at 280.42, a gain of Re0.19 against the greenback.
On Monday, the local unit closed at 280.61.
Globally, the US dollar was steady on Tuesday as investors deliberated the chances of the Federal Reserve cutting interest rates next month after dovish comments from policymakers, while the frail yen remained on intervention watch.
Fed Governor Christopher Waller said the job market is weak enough to warrant another quarter-point rate cut in December, though action beyond that depends on a flood of impending data delayed by the government shutdown.
Waller’s comments echoed those of New York Fed President John Williams from Friday, helping shift expectations of near-term rate cuts. Traders are now pricing in an 81% chance of a cut next month versus 42% a week earlier, CME FedWatch showed.
The sudden shift in rate cut wagers has weighed slightly on the dollar. The euro last bought $1.1522 after eking out small gains overnight, while sterling was at $1.3103.
The dollar index, a measure of the US currency against major rivals, was at 100.2 in early trading.
Fed officials, though, remain divided on the next steps, with the central bank still lacking the full suite of data as government statistical agencies dig through the backlog of work from the 43-day shutdown that ended November 14.
Oil prices, a key indicator of currency parity, were little changed on Tuesday after rising in the previous session as concerns that supply will exceed demand next year outweighed worries that Russian shipments will remain under sanctions as talks to end the Ukraine war remain inconclusive.
Brent futures fell 17 cents, or 0.3%, to $63.20 a barrel as of 0158 GMT.
West Texas Intermediate (WTI) crude declined 12 cents, or 0.2%, at $58.71.
American Dollar Exchange Rate