Intra-day update: rupee’s fall continues against US dollar

The Pakistani rupee continued to stay under pressure against the US dollar, depreciating around 0.1% during the opening hours of trading in the inter-bank market on Tuesday. At 10:30am, the rupee was hovering at 303.35, a decrease of Re0.30, in the inter-bank market. Reports suggest its rate in the open market also fell, with the gap between the two rates widening further. On Tuesday, the rupee had closed at the then-record low of 303.05 against the US dollar in the inter-bank market. In a related development, Moody’s Investors Services said on Tuesday that weak infrastructure and governance act as additional constraints for Pakistan. Moody’s in its latest report stated that a lack of fiscal capacity has constrained resources allocated to capital expenditure in Pakistan, where infrastructure quality is significantly worse than for other large Asian economies. Globally, the US dollar nursed its sharpest drop in a month and a half on Wednesday, as investors bet that softer-than-expected U.S. jobs data reduced the chances of further Federal Reserve rate hikes. The US dollar index - which measures the currency against six developed-market peers including the yen and euro - was little changed at 103.57 after pulling back from as high as 104.36 overnight after a sharp drop in the US. Oil prices, a key indicator of currency parity, extended gains on Wednesday after industry data showed a large draw in crude inventories in the U.S., the world’s biggest fuel consumer, and as concerns about a hurricane in the Gulf of Mexico kept investors on edge. This is an intra-day update