Daily Times

Pakistani rupee snapped a two-day losing streak against the US dollar by recovering 33 paisa (+0.19 percent) on Friday.

The State Bank of Pakistan said in a statement that the dollar opened at Rs177.83 in the interbank market and closed at Rs177.50. The rupee witnessed a trading range of 25 paisa during the session, showing the intraday high bid of 177.75 and low offer of 177.60. Within the open market, the rupee was traded unchanged at 177.50/178.50 per dollar.

On the other hand, the US Dollar Index, which gauges the greenback against a basket of its main competitors, gained 0.29 percent to reach 98.02, the level last seen back in June 2020. The Russia-Ukraine war-led risk aversion continues to bolster the dollar and keeps the index well bid on the back of the deterioration of the geopolitical arena.

Overall, the rupee shed 39 paisa against the American currency during the last five days, while the local unit devalued by 20.07 during the ongoing fiscal year 2021-22 and 99 paisa during the current year 2022.

According to experts, the ongoing conflict between Russia and Ukraine has pushed commodity prices to their record historic high level. Given the rising commodity prices, the soaring import bill has badly hit the current account balance of Pakistan which created a spell of depreciation around the rupee. They said that higher dollar’s demand for oil payment may further deteriorate the rupee value.

They said that an increase in exports helped reduce the trade deficit to $3.1 billion but higher imports is a bad sign. Pakistan’s merchandise trade deficit for the month of February 2022 clocked in at $3.1 billion compared to a deficit of $3.4 billion in the previous month, depicting a decline of 9.7 percent on a month-on-month basis, as imports declined by 2.3 percent during the period under review.