USD/PKR: Pakistani Rupee Stable on the Currency Market

The exchange rate of Pakistani rupee against US dollar remained stable at Rs155.10 in the interbank market on Friday. On the currency market, Pakistani Rupee touched a four week high, but still remained inside the range established by the SBP. During early Asia trading hours, the USD/PKR exchange rate was seen quoted higher at 155.58.

The State Bank of Pakistan (SBP) reported that the Pakistani Rupee was traded at Rs 155.35 against Rs 156.40 in the currency market.

According to the latest CFTC data, US dollar buyers have reduced their bullish bets to the lowest level since this summer. Emerging market currencies can benefit from  the falling dollar bets. According to PIMCO, the world’s biggest bond manager, emerging market currencies look very attractive and they are set to surge on the prospects of a US — China trade deal.

“According to our valuation models, currencies around emerging markets are closer or close to the cheapest levels in the last two decades,” said Roland Mieth, emerging-markets portfolio manager at Pimco — citing Bloomberg.

The US alerts Pakistan about the threats to its economy if they pursue China’s huge infrastructure projects CPEC (China Pakistan Economic Corridor). The CPEC, launched in 2015 is a $60 billion-plus project aimed to China’s resource-rich Xinjiang Uighur autonomous region with Pakistan.

The benchmark equity index Karachi Stock Exchange KSE-100 Index closed up 2.22% at 37925 on Friday. Year-to-day the Pakistan stock exchange market is up 2.32%. The Pakistan 10-year government bond yield gapped higher and closed at 11.655 versus 11.385 previous closing rates.

On the other hand, the dollar index, which gauges the greenback’s strength against a basket of major currencies, was seen ending last week on positive territory closing at 98.27 registering a 0.3% gain.

USD/PKR Technical Pattern

On the technical front, the USD/PKR exchange rate is trying to challenge again the unofficial peg established at the 155.00 support level. There is no material change in the long-term bullish USD/PKR trend.

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