- Pakistan Rupee (PKR) extends losses in risk off trade as global covid restrictions tighten
- Oil extends losses
- US Dollar (USD) advances in flight to safety
- US fiscal stimulus talks in focus
The US Dollar Pakistan Rupee (USD/PKR) exchange rate is pushing higher on Tuesday extending gains for a second consecutive day. The pair settled +0.1% higher on Monday at 160.00. At 10:15 UTC, USD/PKR trades +0.22% at 160.35, towards the upper end of the daily traded range.
Risk off trade is dominating global financial markets on Tuesday amid a rise in global covid cases and tightening lockdown restrictions. Hong Kong announced its strictest social distancing measures since the pandemic started and California also imposed lockdown as covid cases and hospitalizations surge post Thanks giving public holiday.
Covid cases in Pakistan increased by 3,795 over the past 24 hours, taking the total to 423,000.
The risk off mood was denting demand for riskier assets although news that the UK started its vaccination programme has helped to limit the downside. The Pakistan benchmark Karachi 100 index slipped lower. The riskier Pakistan Rupee was also out of favour. Meanwhile demand for the safe haven properties of the US Dollar lifted the greenback.
Oil prices are seen extending losses from the previous session as tighter lockdown restrictions fuel concerns over near term demand.
The safe haven US Dollar is edging higher versus its major peers. The US Dollar Index which gauges the greenback versus a basket of major currencies trades +0.05% higher at the time of writing.
With no high impacting US data to grab investors attention, eyes will be firmly on US additional fiscal stimulus.
US Congress is expected to vote this week on a stopgap funding measure. This will then allow lawmakers more time to negotiate an emergency covid rescue package.
The need for additional; US stimulus is clear as recent data highlighted the stalling of the US labour market recovery. Friday’s non-farm payroll data revealed just 245,000 jobs were created in November versus the almost 500,000 expected.