Key Points
- Rupee gains Rs 0.01 against the US dollar in interbank market
- Local unit closes at 280.26 compared with 280.27 a day earlier
- Dollar holds firm globally ahead of major central bank meetings
- Oil prices climb on renewed geopolitical concerns
ISLAMABAD: The Pakistani rupee posted a marginal improvement against the US dollar on Thursday, edging up by Rs 0.01 in the interbank market as subdued local demand and cautious global positioning kept currency movements largely range-bound.
The local unit settled at 280.26 against the greenback, compared with the previous close of 280.27, according to data released by the Pakistan Stock Exchange-linked interbank market.
Market participants said the marginal gain reflected balanced dollar inflows and outflows, with exporters and importers largely staying on the sidelines ahead of year-end settlements. Currency dealers noted that the rupee has remained broadly stable in recent sessions, supported by administrative controls and improved external account visibility.
In the international market, the US dollar held on to recent gains against major peers as investors positioned themselves ahead of central bank decisions in Britain, the euro zone, and Japan. The dollar index, which tracks the greenback against a basket of currencies including the euro and the yen, was little changed at 98.35 after rising 0.2% in the previous session.
Sterling remained under pressure after an unexpected drop in UK inflation strengthened expectations of an interest rate cut by the Bank of England. Interest rate futures are now pricing in an almost certain quarter-point reduction at the BoE’s policy meeting later on Thursday.
The Japanese yen trimmed part of its earlier losses as the Bank of Japan began a two-day policy meeting that is expected to deliver a rate hike, potentially taking borrowing costs to their highest level in three decades. The yen strengthened 0.2% to 155.45 per dollar, recovering from a 0.6% slide recorded a day earlier.
The euro was largely unchanged at $1.1743, and sterling steadied at $1.3373 after falling 0.4% in the previous session. The European Central Bank is widely expected to keep interest rates unchanged at its meeting later in the day.
Commodity prices also influenced broader currency sentiment. Oil prices, a key indicator for Pakistan’s import bill and exchange rate dynamics, rose sharply in Asian trade after US President Donald Trump announced a blockade on tankers entering and leaving Venezuela, leaving most of the country’s oil exports on hold.
US West Texas Intermediate crude climbed 98 cents, or 1.7%, to $56.89 per barrel by 0120 GMT, after initially rising by more than a dollar. Brent crude gained 92 cents, or 1.54%, to $60.60 per barrel.
Analysts said sustained volatility in global energy prices could feed into Pakistan’s external financing needs over the medium term, though short-term rupee movement is expected to remain tightly managed barring any major external shock.
