Intra-day Update: Rupee Depreciates Against US Dollar

The Pakistani rupee depreciated 0.51% versus the US dollar during trading on Wednesday.

At roughly 11:30 a.m., the rupee was trading at 289, down Rs1.46 in the interbank market.

The rupee had suffered back-to-back losses versus the dollar on Monday, depreciating 0.31% to close at 287.54.

Experts attribute the growth in the value of the US dollar to the market demand-supply dynamic.

“The government’s relaxation of import restrictions is driving market demand for US dollars,” Samiullah Tariq, Head of Research at Pak Kuwait Investment Company Limited, said.

According to the analyst, the greenback is projected to continue range-bound, trading in the 285-290 region.

In a significant development, the Federal Board of Revenue (FBR) has tentatively collected Rs538 billion in July 2023, compared to the allotted monthly target of Rs534 billion, representing a Rs4 billion increase.

Globally, the US dollar failed to gain ground on Wednesday after Fitch downgraded the US government’s top credit rating, raising concerns about the country’s fiscal prospects, despite some support from a relatively durable run of economic data.

A relatively stable run of economic statistics is providing support.

Fitch downgraded the United States to AA+ from AAA on Tuesday, prompting a furious response from the White House and surprising investors, despite the resolution of the debt ceiling crisis two months ago.

The US dollar index was last 0.09% higher at 102.09, after falling sharply in the aftermath of the Fitch report.

Oil prices, a major measure of currency parity, rose about 1% on Wednesday, trading around their highest since April, as data suggesting solid demand from the world’s largest fuel user, the United States, countered demand concerns elsewhere.

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