The Pakistani rupee continued its upward momentum against the US dollar in Monday’s early interbank trading, reflecting improved sentiment in the local currency market.
At around 10am, the rupee was trading at 281.80 per dollar, appreciating by Re0.26 or 0.09% from the previous close.
Domestic Drivers of Strength
The local currency has been on a steady positive run in recent days, supported by law enforcement agencies’ crackdown on illegal currency dealers and smugglers. This enforcement has boosted confidence among traders and curbed speculative pressure on the rupee.
During the past week, the rupee gained Re0.41 (0.14%), closing at 282.06 against the greenback compared to 282.47 a week earlier, according to data from the State Bank of Pakistan (SBP).
Global Market Influence
Internationally, the US dollar was subdued on Monday as traders awaited the White House meeting between US President Donald Trump and Ukrainian President Volodymyr Zelenskiy, where European leaders are also expected to join discussions on a possible peace framework with Russia.
Meanwhile, investors are focused on the upcoming Federal Reserve’s Jackson Hole Symposium (Aug 21–23) for clues on future monetary policy. The US dollar index (DXY), which tracks the greenback against six major currencies, traded near 97.85, slightly higher after last week’s 0.4% drop.
The euro remained steady at $1.1705, while the British pound edged up 0.07% to $1.3557. Market odds for a September Fed rate cut stand at 84%, down from 98% last week, after US data showed strong retail sales and higher wholesale prices, dampening expectations of a larger 50 bps cut.
Oil Market Connection
Oil prices, a key factor for emerging market currencies, slipped on Monday. Brent crude futures traded at $65.59 per barrel, down 0.39%, while WTI fell 0.29% to $62.62. The drop came as the US refrained from tightening sanctions on Russian oil exports following Trump’s meeting with Russian President Vladimir Putin in Alaska.
Stay updated with Daily Forex Pakistan.