Pakistani Rupee Gains Slightly Against US Dollar

The Pakistani rupee saw a slight increase against the US dollar, rising by 0.05% during the initial trading hours in the interbank market on Friday.

At 11am, the rupee was trading at 283.53, reflecting a gain of Re0.14 against the US currency.

The previous day, Thursday, the rupee closed at 283.67.

Global Market Overview

On the global stage, the US dollar experienced some volatility on Friday, remaining near its lowest point in three and a half years against both the euro and sterling. This movement came as traders anticipated potential US rate cuts and awaited developments on trade agreements before President Donald Trump’s tariff deadline in July.

With tensions from the Israel-Iran situation easing following a ceasefire, the market’s attention has shifted to US monetary policy this week.

The possibility of Trump nominating a more dovish successor to lead the Federal Reserve, potentially before the end of Jerome Powell’s term to influence policy, has increased the likelihood of rate cuts by the central bank.

Powell’s recent testimony before US Congress was also seen as leaning towards a more dovish stance, further fueling expectations of rate reductions. Market analysts are now factoring in 64 basis points (bps) of easing this year, compared to the 46 bps anticipated earlier.

According to a source familiar with White House discussions, Trump has not yet made a definitive decision regarding Powell’s replacement, and an announcement is not expected soon.

Trump has frequently criticized Powell and advocated for rate cuts throughout the year, which has raised concerns among investors about the gradual decline of the US central bank’s autonomy and reputation.

The dollar index, which compares the US dollar to six other currencies, was hovering near its lowest level since March 2022 at 97.398 and is on track for a 2% decrease in June, marking its sixth consecutive month of decline.

Oil Prices Decline

Oil prices, a crucial indicator of currency parity, are set for their most significant weekly drop since March 2023. This is due to the absence of significant supply disruptions resulting from the Iran-Israel situation, which has diminished any risk premium.

Brent crude futures increased by 35 cents, or 0.52%, reaching $68.08 a barrel by 0429 GMT, while US West Texas Intermediate crude rose by 40 cents, or 0.61%, to $65.64. Both contracts are currently headed for a weekly decrease of approximately 12%.

These benchmarks have now returned to the levels seen before Israel initiated the conflict by launching missiles at Iranian military and nuclear sites on June 13.

This information reflects an intra-day update.