The Pakistani Rupee is strengthening for a fourth consecutive session versus the US Dollar on Tuesday. The US Dollar Pakistan Rupee exchange rate settled -0.3% lower in the previous session at 160.035.
At 10:15 UTC, USD/PKR is trading down -0.1% at 159.50. This is approximately in the middle of its daily traded range of 158.62 – 160.25.
Pakistan To Reopen Economy
The Pakistan Rupee is advancing following an announcement by the Prime Minister Imran Khan that lockdown in Pakistan will be relaxed in the coming days, owing to the economic situation in the country and the hardship that the lock down has brought to the population.
Pakistan’s Minister for planning, development and special initiatives, Asad Umar, has warned that around 18 million people in Pakistan are feared to lose their jobs owing to the coronavirus crisis. Around 70 million people in the country could fall below the poverty line and over 1 million small businesses could be wiped out as lockdown paralysed the economy.
Any moves towards reopening the economy are being viewed as a positive step for the economy and is therefore boosting demand for the Rupee.
US Service Sector Data In Focus
The US Dollar started the session on the back foot on Tuesday. However, the greenback is gaining in strength versus its major peers as the European session progresses. The Centre of Disease Control in American has projected that US covid-19 deaths could double to around 134,000 by mid-June. Whilst the White House dismissed the report a report from the Health Metrics and Evaluation (HIME) had similar findings, warning over easing the lockdown restrictions too early.
US Dollar investors will now look ahead to the release of US ISM non-manufacturing PMI. Analysts are expecting the PMI to drop sharply in April to 32, down from 52.5 in March. This would be the lowest reading on record and the fastest pace of deterioration in the sector since records began in 1996 reflecting the full month of lockdown.
The measures that were implemented to slow the spread of the coronvirus have resulted in demand in the service sector evaporating. A worse than forecast reading could boost safe haven US Dollar demand.