Thursday’s trade saw USD/PKR within the range 154.40-154.66, while the pair closed flat at 154.40 amid lack of major macro data, while the World Health Organization’s Emergency Committee said it was “a bit too early” to announce the new coronavirus outbreak a health emergency of international proportions.
In an unprecedented move in public health history, China on Thursday placed millions of citizens on lock down in two cities in the area where the virus had originated. Meanwhile, the state television reported that 634 cases of infection had so far been confirmed.
These headlines led to caution, favoring demand for safe haven assets such as JPY, as it was uncertain to what extent the coronavirus outbreak could impact the global economic outlook.
On the macroeconomic front, the weekly report by US Labor Department showed the number of Americans, who filed for unemployment assistance, had risen at a lesser rate than anticipated, by 6 000 to the seasonally adjusted 211 000 during the business week ended on January 17th. The numbers implied labor market tightening even as job growth has shown signs of deceleration.
In other news, Pakistan’s newspaper Dawn stated that the China-Pakistan Economic Corridor (CPEC) had once again faced criticism by a US official for being not transparent enough. Under the project, China has vowed to invest $60 billion in Pakistani infrastructure, which is considered as a crucial step for development of land and sea trade routes in Asia. A spokesperson for Pakistan’s foreign office again defended the CPEC initiative, saying its completion was of the highest priority for the country’s government.
The yield on Pakistan’s 3-year government bonds were last registered at 12.241% on January 23rd, while the yield on Pakistani 10-year bonds were last recorded at 11.336%.
The US Dollar Index was up 0.02% to 97.70 in late Asian trade on Friday.
In terms of economic calendar, preliminary data by Markit may show activity in the US manufacturing industry expanded at a slightly higher rate in January from a month ago. The respective Manufacturing PMI is expected to come in at 52.5 in January, up from a final reading of 52.4 in December.
At the same time, activity in US services sector probably also expanded at a faster pace in January compared to December. The preliminary Services PMI is expected to come in at 52.9 in January, improving from a final estimate of 52.8 in December. The latter has been the highest PMI level since July.
Higher-than-expected readings of either of the two indicators in January would support the USD. The preliminary data will be released at 14:45 GMT.
USD/PKR was up 0.05% at 154.47 in late Asian session on Friday.
