Rupee sees marginal decline against US dollar

The Pakistani rupee registered marginal depreciation of 0.01% against the US dollar in the inter-bank market on Tuesday.

At close, the local unit settled at 278.38, a decline of Re0.04 against the greenback.

The inter-bank market was closed on July 1 (Monday) on account of a bank holiday.

During the previous week, the rupee closed on a positive note as the currency saw marginal appreciation of 0.06% against the US dollar in the inter-bank market.

The local unit closed at 278.34, against 278.51 it had closed the week earlier against the greenback, according to the State Bank of Pakistan (SBP).

The domestic currency that had stood at 285.99 on June 27, 2023 remained relatively stable for most part of the FY24, mostly on the back of administrative measures taken by the SBP announced in September to curb illegal trading and smuggling of currency.

In FY24, the rupee witnessed 2.8% year-on-year appreciation against the US dollar.

In a key development, Finance Minister Muhammad Aurangzeb said prior actions for the International Monetary Fund (IMF) programme are largely complete, adding that some structural benchmarks will also be met as Islamabad moves ahead to secure a larger and long-term deal.

When asked what are some of the structural benchmarks Pakistan has to agree to with the IMF, the finance minister said that the country cannot run on the current tax-to-GDP ratio.

Globally, the US dollar was supported by rising US yields and the blowtorch was on low-yielding currencies on Tuesday such as China’s yuan and Japan’s yen, which was pinned to its lowest since 1986.

Benchmark 10-year Treasury yields rose nearly 14 basis points to 4.479% overnight, with analysts attributing the move to expectations of Donald Trump winning the US presidency and raising tariffs and government borrowing.