- Pakistan Rupee (PKR) closed on Wednesday at 6 month high
- Remittances remain over $2 billion for 5th straight month
- US Dollar (USD) edges lower versus major peers as covid cases surge
- US inflation & jobless claims in focus
The US Dollar Pakistan Rupee (USD/PKR) exchange rate is edging higher on Thursday paring some losses from the previous session. The pair settled lower on Wednesday -0.7% at 157.38, the low of the day and a level last seen in early May. At 10:15 USD/PKR trades +0.5% at 158.20.
According to the State Bank of Pakistan, the country’s remittances remained above $2 billion for the fifth straight month in October. The central bank announced remittances of $2.3 billion last month, a 14.1% increase from a year earlier.
The SBP confirmed that remittances from July – October FY21 increased to $9.4 billion, an increase of 26.5% compared to the same period a year earlier.
Improvements in Pakistan’s foreign exchange market structure and measures to formalise cross border flows have contributed to the growth of remittances. The covid crisis has had little impact on the money coming in.
The US Dollar is strengthening versus the Pakistan Rupee; however it is slipping lower versus its major peers. The US Dollar Index which measures the US dollar versus a basket of 6 majors trades -0.25%.
Concerns over rising covid cases are unnerving investors dragging on the greenback. New daily covid cases have surged to 130,000 as the third wave takes hold. New York will see restrictions tighten.
Looking ahead US jobless claims nd inflation data will be in focus. Analysts are expecting the number of Americans signing up for unemployment benefits to fall only slightly from the previous week to 735,000, down from 751,000.
Inflation is also in focus with consumer prices expected to have rise 0.2% month on month in October. On an annual basis CPI is expected to increase 1.3% whilst core CPI which excludes more volatile items such as food and fuel is expected to increase 1.8%. A strong inflation reading could help boot the US Dollar.