Tuesday’s trade saw USD/PKR within the range 154.50-154.70. The pair closed 0.06% lower at 154.50, as reports of the spread of a new coronavirus in China suddenly triggered a move into safe haven assets.
According to reports, this new pneumonia-like virus has already claimed the lives of six people, while new cases of infection have risen to more than 300. The outbreak hit market sentiment as it brought back memories of the fallout from the Severe Acute Respiratory Syndrome (SARS) coronavirus in China in early 2000s, which led to almost 800 death cases.
The World Health Organization is to decide whether to declare a global health emergency at a meeting today.
Meanwhile, the Monetary Policy Committee of State Bank of Pakistan is scheduled to announce its interest rate decision on January 28th, followed by a press conference with Governor Reza Baqir. On November 22nd the central bank kept its benchmark rate at an 8-year high of 13.25%, since it has been battling excessively high levels of inflation.
The yield on Pakistan’s 3-year government bonds were last registered at 12.243% on January 21st, while the yield on Pakistani 10-year bonds were last recorded at 11.306%.
The US Dollar Index was gaining 0.05% to 97.66 in late Asian trade on Wednesday, nearing the recent one-month high of 97.73.
In terms of economic calendar, today’s focus will be on the US existing home sales report at 15:00 GMT. The index of sales probably rose 0.8% to a seasonally adjusted annual level of 5.42 million units in December compared to November, according to market consensus. In November, sales of previously owned houses were 1.7% lower from a month ago to reach 5.35 million. Sales of single family houses dropped 1.2% to 4.79 million in November, while sales of condos went down 5.1% to 0.560 million. Higher-than-expected sales increase in December would have a moderate bullish effect on the USD.
The benchmark equity index Karachi Stock Exchange KSE-100 Index slides amid China virus worries and was seen quoted down -0.54% at 42,435 compared to previous closing price of 42,626.
USD/PKR was up 0.01% to 154.51 in late Asian session on Wednesday.