Rupee Continues Ascent Against US Dollar

The Pakistani rupee extended its gains against the US dollar, appreciating by 0.09% in early inter-bank trading on Monday. At approximately 10:00 am, the rupee’s value stood at 281.80, reflecting an increase of Re0.26.

The rupee has exhibited a positive trend versus the dollar recently, buoyed by improved market sentiment. This improvement comes amid law enforcement’s ongoing operations targeting illicit currency traders and smuggling activities.

Last week, the Pakistani rupee sustained its upward movement against the US dollar in the inter-bank market, gaining Re0.41, which translates to 0.14%. According to the State Bank of Pakistan (SBP), the local currency concluded the previous week at 282.06, compared to its prior close of 282.47 against the dollar.

On the international front, the US dollar showed some hesitancy on Monday, prior to a crucial meeting between US President Donald Trump and Ukrainian President Volodymyr Zelenskiyy. Investors are also anticipating insights from the Federal Reserve’s Jackson Hole symposium.

Currency fluctuations were relatively muted during the early Asian trading session. The dollar stabilized after its decline last week, as traders moderated expectations of a significant Fed rate cut in the coming month.

The euro remained stable at $1.1705, while the British pound increased marginally by 0.07% to $1.3557. The US dollar index, which measures the dollar against a basket of currencies, edged up to 97.85, after having decreased by 0.4% the previous week.

Currently, markets are estimating an 84% probability of the Federal Reserve reducing rates by a quarter of a point next month. This is a decrease from the 98% expectation last week. Recent economic data, including a rise in US wholesale prices and a robust increase in retail sales for July, has diminished prospects for a larger 50-basis-point cut.

The primary focus for investors on Monday is the meeting between Trump and Zelenskiy, along with participation from other European leaders. Washington is urging Ukraine to consider a swift peace agreement to bring an end to the ongoing conflict. Trump is encouraging Zelenskiy to come to an understanding, particularly after Trump’s discussion with Kremlin head Vladimir Putin in Alaska, which suggested a greater alignment with Moscow’s desire for a peace agreement over an initial ceasefire.

Oil prices, a key indicator of currency parity, decreased on Monday. The US did not apply further pressure on Russia to end the conflict in Ukraine by introducing additional measures to disrupt Russian oil exports following the meeting between the two countries’ leaders on Friday.

Brent crude futures fell by 26 cents, or 0.39%, reaching $65.59 per barrel by 0028 GMT. Similarly, US West Texas Intermediate crude was at $62.62 per barrel, down 18 cents, or 0.29%.

This information is an intra-day update.