Pakistani Rupee Marks Seventh Consecutive Gain Against US Dollar

In a positive trend, the Pakistani rupee continued its upward momentum against the US dollar for the seventh consecutive session, registering a 0.04% appreciation in the inter-bank market on Wednesday.

According to the latest data from the State Bank of Pakistan (SBP), the rupee settled at 282.9 after a gain of Re0.11. This follows a slight increase on Tuesday when the rupee settled at 283.01 against the US dollar.

In the realm of fiscal policy, fresh austerity measures for the fiscal year 2023-24 are currently awaiting approval from the prime minister. Official documents from the Finance Division disclosed that measures, including a ban on the procurement of durable goods and vehicles, are still in effect and actively enforced.

On the international front, the US dollar faced downward pressure against major currencies as traders continued selling the currency in anticipation of potential interest rate cuts by the US Federal Reserve. After last week's Federal Open Market Committee meeting, where three rate cuts were suggested for 2024, there has been a notable rally in financial markets.

Market participants are now estimating a 67.5% likelihood of the first rate cut occurring at the Fed's March meeting, according to the CME FedWatch tool.

The dollar index remained mostly flat at 102.20, recovering from a 0.3% decline on Tuesday that saw it reach a four-month low of 101.76 last week.

In the energy sector, oil prices surpassed $80 a barrel on Wednesday, driven by concerns over global trade disruptions and geopolitical tensions in the Middle East following attacks on ships by Yemen’s Iran-aligned Houthi forces in the Red Sea. Brent crude futures rose 89 cents to $80.12 a barrel, while US West Texas Intermediate crude climbed 93 cents to $74.87 a barrel.