- Pakistani Rupee (PKR) finds support as China’s GDP +4.9% in Q3 vs 3.2% Q2
- Optimism China could haul global economy back on its feet
- US Dollar (USD) eases on risk flows amid upbeat vaccine news from Pfizer
- Optimism over additional US fiscal stimulus supports risk sentiment
After recording losses in the previous week, the US Dollar Pakistan Rupee (USD/PKR) exchange rate is extending those losses at the start of the new week. The pair shed -0.35% across the previous week, settling at 163.3, towards the lower end of the weekly trading range. At 09:15 UTC, USD/PKR trades -0.6% at 162.35.
China’a GDP data showed growth of 4.9% in the third quarter, just slightly missing expectations of 5.2%. However, it was still faster than 3.2% economic growth achieved in Q2. Despite the disappointing print, there were some encouraging signs with an upturn in consumption and continued strength in the factory sector. Meanwhile, monthly indicators actually beat forecasts indicating that the economic recovery is gaining momentum. This bodes well for the coming quarter and hopes that China will be able to help haul the globally economy and its trading partners such as Pakistan back onto its feet.
The US Dollar is trading lower versus its peers as the mood in the market improves. Investors are shunning the US Dollar’s safe haven properties in search of riskier assets and currencies.
News from drug maker Pfizer that a coronavirus vaccine could be available by the end of the year is boosting risk appetite. Pfizer made the announcement on Friday boosting risk sentiment after both Johnson & Johnson and Eli Lilly announced earlier last week that their covid vaccine candidate trials had been suspended due to safety concerns.
Also boosting the mood are reports that the US Democrats and Republicans could be closer to an additional stimulus package. Hopes are growing that a deal could still be achieved before the US elections after President Trump indicted that he is willing to support a fiscal stimulus package in the region of $2 trillion, although he would still need to convince other Republicans who are after a smaller package.
