Rupee Shows Slight Gain Against US Dollar

The Pakistani rupee saw a slight improvement against the US dollar, appreciating by 0.1% in the inter-bank market on Friday.

At approximately 10:00 AM, the local currency was trading around 281.78, reflecting a gain of approximately Re0.28 against the US currency.

On the preceding day, Thursday, the Pakistani rupee concluded trading at 282.06.

Global Market Overview

Across the globe, the US dollar experienced weakness on Friday. It is on track to record its first weekly decline in five weeks against both the euro and the yen as concerns surrounding the United States’ deteriorating financial stability have led investors to seek safer investment options.

Following a downgrade of US debt ratings by Moody’s the previous week, investor focus has shifted to the country’s substantial $36 trillion debt and former US President Donald Trump’s tax legislation, which has the potential to increase the debt by trillions more.

Former President Trump described the bill as a “big, beautiful bill”. It was approved by the Republican-controlled US House of Representatives and is now being reviewed by the Senate, which is expected to take several weeks.

The dollar index, which measures the US currency’s performance against six other currencies, is expected to decline by 1.1% this week, although it remained relatively stable at 99.829 in early Asian trading.

This is despite a significant sell-off in US Treasuries at the beginning of the week.

The 30-year bond yield remained above 5% during Asian trading hours on Friday, nearing 19-month highs. It is approaching the October 2023 high of 5.179%, and surpassing this level would mark its highest point since mid-2007.

Oil Prices Decline

Oil prices, an important indicator of currency parity, decreased on Friday. This decline was influenced by a stronger US dollar and speculation that OPEC+ may further increase its crude oil production.

Brent crude futures decreased by 37 cents to $64.07 a barrel as of 0015 GMT. U.S. West Texas Intermediate crude futures dropped by 39 cents to $60.81.

Brent was down 2% for the week, and WTI was 2.7% lower.

Oil prices typically have an inverse relationship with the dollar, as a stronger dollar increases the cost of the commodity for buyers outside the U.S.

This information reflects an update during the trading day.