Rupee broadly stable, stands at 221.92 against US dollar – Markets
The Pakistani rupee posted a marginal gain against the US dollar on Friday and improved 0.01% in the interbank market, while the greenback continued to gain against other currencies after the Reserve rate hike federal government by 75 basis points.
According to the State Bank of Pakistan (SBP), the Rupee closed at 221.92 after an appreciation of Re0.03.
On Wednesday, the rupiah stabilized at 221.95 after depreciating by Re0.52 or 0.23%.
In a key development, the SBP has allowed exchange companies to sell 20% of their inbound workers’ remittances to customers to meet their demand, while the remaining 80% of inbound remittances will be put back into the market. interbank,” said Malik Bostan, Chairman, Exchange Company Association of Pakistan (ECAP).
Bostan said customers are selling on the black market instead of exchange companies because the rate on the black market is 10-15 rupees higher.
In addition, foreign exchange reserves held by the central bank increased by 1.5 billion dollars due to the arrival of contributions from the Asian Development Bank (ADB).
“During the week ended October 28, 2022, SBP reserves increased by $1,473 million to $8,912.9 million. This increase is attributed to the receipt of $1,500 million from the Asian Development Bank (AfDB),” the SBP said. .
Internationally, the dollar rose on Thursday, supported by a sharp rise in Treasury yields, after the Federal Reserve signaled that U.S. interest rates will likely peak above what investors are currently expecting, while as the pound fell ahead of a Bank of England policy meeting.
The Fed on Wednesday raised its benchmark funds rate by 75 basis points (bps) to 3.75-4% as widely expected.
The U.S. dollar index, which measures the greenback against a basket of currencies, rose 0.5% on the day to 112.70, its highest level in a week.
Oil prices, a key currency peg indicator, fell around 1% on Thursday as a rise in US interest rates pushed the dollar higher and heightened fears of a global recession that would reduce demand fuel.