The US dollar is slightly higher against the Pakistani rupee on Friday.
- Pakistan independence day today (August 14th)
- US retail sales miss but ex-autos sales beat expectations
- US consumer sentiment picks up more than expected in August
USD/INR was higher by 62 pips (+0.37%) to 168.125 as of 3pm GMT. This week the dollar-Indian rupee exchange rate is higher by +0.30%.
The currency pair snapped a 3-day losing streak to turn higher on the week thanks to Friday’s gains.
PKR: Pakistan celebrates independence
The people of Pakistan were able to celebrate their Independence in close to normal conditions thanks to a significant drop in virus cases over the past few weeks. The country has around 17,000 active coronavirus cases, with 92% recoveries, according to the Health Ministry.
A more risk-off tone across markets that saw US stocks edge away from record highs helped demand for the dollar as a haven. The Pakistani rupee hit new record lows versus the dollar this week but is yet to get a firm grip on prices above 168.
The failure from Congress to deliver a new US stimulus bill this week in the wake of the executive orders signed by President Trump to extend unemployment benefits and cut payroll taxes is weighing on broader market sentiment and pulling down riskier currencies like the rupee.
USD: Consumer sentiment rises in August
The dollar firmed on Friday after a mixed retail sales report and higher than hoped consumer confidence data rounded off a broadly more stable week of price action. Unemployment and inflation data both saw significant upwards surprises, giving traders more room for confidence in the US economy.
The University of Michigan consumer sentiment index rose to 70.6 in August from 68.5 in July and above the 70.3 consensus estimate. Put together with the retail sales figures, investors are gaining faith in the idea of a V-shaped recovery in consumer spending.
Headline retail sales came in at 1.2% – almost half the 2.1% expected but that was offset by higher than expected sales excluding automobiles (ex-autos). Additionally, June was revised up. There was a deceleration from the June figures overall, but that was to be expected since a lot of the rise in June was pent up demand from the lockdown in April and May.