![]() ![]() Internationally, the dollar started the week firmly on Monday, with a strong U.S. ![]() “If commodity prices increase, this would hit the country,” he added. Moreover, after OPEC’s decision to cut oil production, oil prices are expected to increase in the coming weeks in the coming winter months, as demand for energy needs surges, said Khan. Meanwhile, the US dollar remains strong against other currencies, as US Fed continues to hike the policy rate. “However, this would be a very short-term play and after a while, the market forces would kick in,” he added. “The appreciation in currency comes after a majority of persons submitted dollars to the market amid Ishaq Dar’s statements,” he said. Saad Khan, Head of Research at IGI Securities told Business Recorder that there are no fundamental developments driving the rupee appreciation. On complaints received from business community pertaining to Letter of Credit (LCs), Dar informed that the State Bank had compiled the data and as a first step it was decided that all the pending payments worth upto $50,000 would be cleared, adding that about 7,952 payments would be made, which would help to clear about 52% pending LCs. “We have decided not to go to Paris Club,” Dar said, adding that in consultation with Prime Minister Shehbaz Sharif it was decided that it wasn’t in the nation’s interest to ask for a restructuring. The new rating from Moody’s raised concerns that Pakistan could default on its foreign debt as contends with economic turmoil and a balance of payments crisis. In an important announcement, Finance Minister Ishaq Dar on Sunday said that Pakistan will not seek debt restructuring from Paris Club creditor nations, as he sought to restore market confidence after a credit rating downgrade. The recent appreciation of rupee is being attributed to actions taken by the State Bank of Pakistan (SBP) and other authorities to curb speculation in the market. In the previous week, the rupee appreciated by Rs8.53 or 3.88% against the US dollar. The domestic markets fell on Monday morning as Sensex fell more than 700 points during the early session.On Friday, the rupee’s winning streak against the US dollar entered the 11th session, as the rupee closed at 219.92 after appreciating Rs2.02 or 0.92%. Oil prices eased on Monday, after having extended their rally with a near 4 per cent jump on Friday to five-week highs. US Treasury yields advanced on Monday with the US dollar index nearing the 113 mark. Growth in the US jobs market is slowing but an unexpected drop in the unemployment rate has fuelled expectations that the Federal Reserve will continue with its aggressive tightening of monetary policy, which will make investors flee from other currencies and bring more investors to the greenback. Traders said that the central bank had sold dollars through state-run banks as the local currency went past the 82-mark for the first time. The interventions of Reserve Bank of India (RBI) couldn't do much to arrest the rupee's decline. The country's forex reserves went down to $532.66 billion, the lowest since July 2020, in the week through September 30. The Indian rupee had been depreciating and posting record lows from concerns over FII outflows, rising oil prices, ebbing interests from domestic investors, rising US Treasury yields and demand for the greenback. The local currency declined 37 paise, to a record low of 82.67 versus the greenback. The Rupee on Monday dropped to a fresh record low against the US dollar, with an increased sell-off resulting from the good US jobs report which hints at more aggressive hikes from US Federal Reserve. ![]()
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