The Pakistani rupee (PKR) finally terminated its ten-session depreciation streak against the US dollar on Friday as the local currency concluded trading at Rs305.47 versus the greenback. The State Bank of Pakistan (SBP) reported a modest appreciation of Re0.07, or 0.02 per cent, when compared to the previous day’s closing rate.
Thursday had marked a historic low for the PKR, with a closing rate of Rs305.54 against the US dollar in the inter-bank market. This decline had raised concerns about the currency’s stability and its impact on the nation’s economy.
However, the SBP made a significant announcement on Friday. It categorically rejected reports circulating in the media about an emergency meeting of the Monetary Policy Committee (MPC). The central bank termed these reports as completely baseless and emphasized that it would be premature to forecast the future policy rate.
According to the central bank, only the MPC, an independent statutory body, holds the authority to make decisions regarding the policy rate. The next scheduled meeting of the MPC is set for September 14, 2023.
Internationally, the US dollar has faced challenges as it attempts to maintain its winning streak against major currencies. Traders are closely monitoring the pivotal monthly US jobs report, which is expected to shape Federal Reserve policy in the coming months.
The US dollar index, which measures the currency against a basket of six developed-market peers including the euro, sterling, and yen, saw a slight decline of 0.05 per cent to 103.58 on Friday. This marks a cumulative decline of 0.53 per cent for the week.
Additionally, oil prices, a significant indicator of currency parity, remained above $87 a barrel. Crude prices are showing signs of snapping a two-week losing streak, driven by expectations of tightening supplies.
The Pakistani economy remains closely tied to global economic developments, making these currency fluctuations and international economic indicators crucial for policymakers and market participants. The nation will continue to monitor these trends closely in the days and weeks ahead.
