The Pakistani rupee registered marginal improvement against the US dollar, appreciating 0.04% during the opening hours of trading in the inter-bank market on Thursday.
At 10am, the currency was hovering at 278, a gain of Re0.11 against the greenback. It is pertinent to mention that the currency market was closed on July 16-17 on account of Muharram holidays.
On Monday, the currency had settled at 278.11 against the greenback.
In a key development, the International Monetary Fund (IMF) said on Friday that it had reached a staff level agreement (SLA) with Pakistan for a $7-billion, 37-month loan programme aimed at cementing stability and inclusive growth.
On Tuesday, Moody’s Ratings said that the new International IMF programme will improve Pakistan’s (Caa3 stable) funding prospects, but warned Islamabad’s ability to sustain reform implementation will be key to unlock financing over the three-year duration.
Globally, the US dollar nursed broad losses as markets prepared for US rate cuts in a few months.
Interest rate markets are pricing more than 60 basis points of US interest rate cuts this year and some 20 basis points of hikes in Japan, narrowing the wide rates gap that had encouraged investors taking on large short positions in the yen.
Catril and other analysts also pointed to remarks from US presidential candidate Donald Trump – who described the dollar’s strength and the weakness of the yen and yuan as a big problem in a Bloomberg Businessweek interview – as rattling markets.
Oil prices, a key indicator of currency parity, ticked higher on Thursday, buoyed by a bigger-than-expected weekly decline in US crude stocks. Brent futures rose 13 cents, or 0.2%, to $85.21 a barrel by 0023 GMT, while US West Texas Intermediate (WTI) crude rose 31 cents, or 0.4%, to $83.16.
Brent climbed 1.6% on Wednesday, and WTI rose 2.6%.
US crude inventories fell by 4.9 million barrels last week, data from the US Energy Information Administration showed.
This is an intra-day update
American Dollar Exchange Rate