PTBP Web Desk
The Pakistani rupee continued its upward trend against the US dollar on Friday, appreciating by 0.13% in early interbank market trading. By 11:00 AM, the rupee was recorded at 282.50, marking a gain of Re0.37 compared to the previous day’s closing rate of 282.87.
This consistent strengthening of the local currency reflects a combination of domestic market confidence and global currency dynamics, which are currently being shaped by new trade policies introduced by the United States.
The rupee’s appreciation in the interbank market indicates renewed optimism in Pakistan’s financial markets, possibly influenced by expected remittance inflows, positive current account trends, or tightening import controls. Despite ongoing macroeconomic challenges, the exchange rate has remained relatively stable over the past weeks.
Currency traders and analysts attributed Friday’s modest gain to a combination of stable demand and improved dollar liquidity in the interbank market.
On the international front, the US dollar surged, posting its strongest weekly performance in nearly three years against major global currencies. This comes as former US President Donald Trump reintroduced and escalated tariff rates on dozens of countries, sparking significant movement in global forex markets.
The dollar’s momentum was further supported by a rising US Dollar Index, which climbed to 100.10 overnight, breaking the 100 mark for the first time since May 29. The Dollar Index tracks the strength of the greenback against a basket of six major currencies, including the euro, yen, Swiss franc, and Canadian dollar.
Japanese Yen:
The yen slumped to a four-month low against the dollar after the Bank of Japan signaled it would delay any potential interest rate hikes. The dovish stance weakened investor confidence in the yen and led to a steep drop in its value.
Swiss Franc:
The dollar gained against the Swiss franc following the Trump administration’s decision to impose a 39% tariff on Swiss imports, a sharp increase from the previously floated 31% rate.
Canadian Dollar:
Canada’s loonie fell to a two-month low after receiving a 35% tariff, significantly higher than the 25% that had been initially suggested. The move rattled market sentiment and put downward pressure on the Canadian currency.
Euro:
The euro hovered near a two-month low, held down by market concerns over what is widely seen as a lopsided trade deal with Washington. The eurozone’s sluggish economic data has also failed to provide support.
The broader economic impact of Trump’s new tariff regime extended to the commodities market as well, especially oil prices, which serve as a crucial indicator for currency parity in oil-importing countries like Pakistan.
On Friday, oil prices remained relatively flat following a more than 1% drop in the previous session. The market continues to digest the implications of the US tariffs, which are expected to curtail global economic activity and dampen fuel demand growth.
- Brent crude futures edged up by 4 cents, or 0.06%, to $71.74 per barrel.
- US West Texas Intermediate (WTI) crude rose by 1 cent, or 0.01%, to $69.27 per barrel.
The appreciation of the rupee, though modest, is significant given Pakistan’s historical struggles with currency depreciation, largely due to external debt servicing, current account deficits, and import pressures. In recent weeks, improved foreign exchange reserves, the IMF program continuation, and reduced demand for the greenback in the interbank market have contributed to the rupee’s relatively stable performance.
Additionally, the State Bank of Pakistan (SBP) has been actively managing exchange rate volatility through monetary policy and regulatory interventions. While no official announcement was made Friday morning, market insiders believe the central bank is comfortable with the current exchange rate trend.
