- Pakistan Rupee (PKR) edges lower but paring Monday’s gains
- Regional exports declined in Q1 of new fiscal year
- US Dollar (USD) trades lower on risk outflow
- US retail sales expected to increase +0.6% despite surging covid cases
The US Dollar Pakistan Rupee (USD/PKR) exchange rate is advancing on Tuesday paring losses from the previous session. The pair settled 0.06% lower at 157.90 on Monday, towards the lower end of the daily traded range. At 10:15 UTC, USD/PKR trades +0.15% at 158.1 as the pair continues to trade at levels last seen in early May.
According to data from the state bank of Pakistan, the pandemic inspired global economic slowdown has taken its toll on Pakistan’s exports in the region. Pakistan’s exports to the surrounding area declined by 24% in the first three months of this fiscal year.
Exports to other countries in the region, including China and Afghanistan were only US$719.1 million, a decline of US$231.9 million compared to the same period last year.
Delving deeper into the number, exports to China the world’s largest economy fell by 25%, whilst exports to Nepal tumbled 78%.
The country’s trade deficit with the regional countries declined during that same period because imports also fell from those countries.
The US Dollar is trading broadly lower versus its major peers although is advancing versus the Rupee. Investors are digesting vaccine news from yesterday along with news of surging covid cases with some tightening lockdown restrictions once again. Fears are rising that the fragile economic recovery will be derailed.
Attention will now turn to US retail sales data due to be released later. Analysts expect sales to show sales easing slightly in October after a particularly strong September. Expectations are for a rise of 0.5% in October compared to the previous month, after a surge of 1.7% in September.
Federal Reserve Jerome Powell is also due to speak later today and could hint at further easing given the lack of fiscal stimulus to support the economy as it heads towards a difficult winter.