Intra-day update: rupee registers marginal gain

The Pakistani rupee gained 0.1% against the US dollar during the early hours of trading on Thursday in the interbank market.

At roughly 11:20 a.m., the rupee was trading at 286.68, up Re0.30.

The rupee gained 0.08% in the interbank market on Wednesday, closing at 286.98.

In a significant event, Federal Minister for Finance and Revenue Ishaq Dar met with US Ambassador to Pakistan Donald Blome on Wednesday to discuss Pak-US economic ties as well as the International Monetary Fund (IMF) loan programme.

Previously, the IMF harshly criticised Islamabad, with Esther Perez Ruiz, the lender’s Resident Representative for Pakistan, expressing dissatisfaction with Dar’s budget proposals for the fiscal year 2023-24, calling them a missed opportunity to broaden the tax base and criticizing the new amnesty scheme as “damaging precedent.”

Separately, Prime Minister Shehbaz Sharif stated on Wednesday that the immediate priority was to raise Foreign Direct Investment (FDI) in the country to $5 billion with the help of the Special Investment Facilitation Council (SIFC).

Internationally, the US dollar fell to a one-month low versus a basket of currencies on Thursday, as Federal Reserve Chair Jerome Powell delivered his semi-annual testimony with little surprise.

Powell told legislators on Capitol Hill on Wednesday that more rate hikes in the United States are “a pretty good guess” if the economy continues on its current path. These remarks echoed what the central bank announced at its policy meeting last week.

In the previous session, the greenback fell about 0.5% against a basket of six major peers.

In early trade on Thursday, oil prices, a major barometer of currency parity, held on to most of the previous day’s gains as markets weighed an unexpected draw in US crude oil supplies against the likelihood of weaker demand after the Federal Reserve chairman hinted at future interest rate hikes.

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