The Pakistani rupee experienced a marginal increase against the US dollar in the inter-bank market on Monday, appreciating by 0.06%. At close, the local unit settled at 279.2, marking a gain of Re0.16 against the greenback, as reported by the State Bank of Pakistan (SBP).
During the previous week, the Pakistani rupee remained relatively stable against the US dollar, settling at 279.36, the same rate observed at the end of the preceding week in the inter-bank market.
Recent reports from Bloomberg News, citing a Pakistani official, indicate that Pakistan is gearing up to seek a new loan of at least $6 billion from the International Monetary Fund (IMF). This loan is intended to assist the incoming government in repaying billions in debt due this year. Negotiations for an Extended Fund Facility with the IMF are anticipated to commence in March or April.
On the global front, the US dollar displayed strength on Monday ahead of a significant week filled with crucial economic releases that will offer insights into the global interest rate outlook. Notably, investors are eagerly awaiting the US inflation reading, which is expected to take center stage.
The core personal consumption expenditures (PCE) price index, considered the Federal Reserve’s preferred measure of inflation, is scheduled for release on Thursday, with expectations for a 0.4% increase on a monthly basis. Currently, the dollar index is slightly higher, standing at 104.01.
In the realm of oil prices, a significant indicator of currency parity, prices experienced a decline on Monday. This decline is attributed to market sentiment suggesting that higher-than-expected inflation could potentially delay cuts to high-interest rates, which have been restraining growth in global fuel demand.
Brent crude futures saw a decrease of 39 cents, or 0.5%, settling at $81.23 a barrel by 1001 GMT. Similarly, US West Texas Intermediate crude futures (WTI) declined by 34 cents, or 0.4%, to $76.15.
These declines extend losses from the previous week, during which Brent crude lost about 2% and WTI fell more than 3%. These movements were influenced by indications that the US Federal Reserve is not rushing to implement interest rate cuts.
