- Pakistan Rupee (PKR) pares last weeks’ gains
- Chinese US tensions rise on Trump’s sanctions
- US Dollar (USD) rises on safe haven gains
- US stimulus optimism could cap gains after weak US jobs report
The US Dollar Pakistan Rupee (USD/PKR) exchange rate is advancing on Monday, paring losses from the previous week. The pair slipped -0.2% across last week, closing on Friday at 159.80 towards the low of the week. At 09:15 UTC, USD/PKR trades +0.2% at 160.15.
A broad risk off mood across the financial markets is dragging on demand for riskier assets and currencies such as the Pakistan Rupee, whilst boosting the safe haven US Dollar.
Rising geopolitical tensions between the US and China have set global markets off on the back foot. With just weeks to go until he leaves office, President Trump is keeping the pressure on Beijing by preparing sanctions on at least a dozen Chinese officials.
On the data front, Pakistan’s trade deficit widened slightly to $9.6 billion in the first 5 months of the current fiscal year, as both imports and exports increased. According to the Pakistan Bureau of Statistics during July – November exports increased 2.1% to $9.7 billion, whilst imports increased 1.3% or $247 million to $19.4 billion.
Oil prices have slipped from 8-month highs as a continued surge in covid cases across the globe have meant more lockdown measures have been brought in hitting the near term demand outlook. West Texas Intermediate trades -1% at $45.78.
Meanwhile the US Dollar is advancing across the board owing to its safe haven properties, which overshadowed optimism surrounding additional fiscal stimulus.
The weaker than expected US jobs report on Friday, which saw just 245,000 new jobs created, well below October’s 610,000, boosted expectations of a new covid rescue package from Congress. A bipartisan group of Democrats and Republicans proposed a compromise stimulus package of $0.9 trillion that leaders on both sides of the House appear to be agreeing on.
There is no high impacting US macro data due to be released today, instead sentiment will continue to drive the greenback.