Rupee declines marginally against US dollar

The Pakistani rupee depreciated marginally against the US dollar, falling 0.04% in the inter-bank market on Wednesday.

At close, the local unit settled at 278.61, a decline of Re0.11 against the greenback.

On Tuesday, the rupee had closed at 278.50 after a loss of Re0.13.

In recent weeks, the domestic currency has largely been around 277-279 against the dollar as Pakistan moves forward with its plan to win a longer and longer International Monetary Fund (IMF) bailout programme.

Internationally, the US dollar steadied on Wednesday after hitting a four-week high against peer currencies overnight as market players awaited key US inflation data and the Federal Reserve’s updated interest rate projections due later in the day.

Data showed consumer inflation rose at a steady pace in May, while producer price declines narrowed slightly, adding to signs that government efforts to prop up the economy were starting to bear fruit.

The dollar index, which measures the greenback against a handful of other major peers, was little changed at 105.26, after touching its strongest level since May 14 at 105.46 overnight.

The US dollar has rebounded after Friday’s stronger-than-expected jobs report raised the prospect of inflation remaining sticky while growth stays strong, making the US central bank less likely to cut rates in the coming months.

Oil prices, a key indicator of currency parity, ticked higher on Wednesday after three key forecasters predicted that global oil inventories would fall in the second half of 2024, boosting prices.

Brent crude futures were up 76 cents, or 0.9%, to $82.68 a barrel at 1005 GMT, while US West Texas Intermediate (WTI) crude futures were up 86 cents, or 1.1%, to $78.76. Both contracts rose by $1 or more earlier in the session.