- Pakistan Rupee (PKR) weakens, domestic equities end 1% higher
- WTI above $50 a 9 month high
- US Dollar (USD) eases versus major peers as Democrats win 1st seat in Senate election
- US ADP payroll & Fed minutes due later
The US Dollar Pakistani Rupee (USD/PKR) exchange rate is holding steady on Wednesday after two straight days of gains. The pair settled on Tuesday +0.3% at 160.25. At 10:15 UTC, USD/PKR trades flat at 160.25.
The Pakistan Rupee lost ground versus the US Dollar in both interbank and open markets owing to a short supply of the greenback prevailing through the session.
The Rupee showed some resilience recovering earlier losses as domestic equities picked up. The benchmark Karachi 30 index closed just shy of 1% higher.
The price of oil continues to rise after surging just shy of 5% in the previous session. West Texas Intermediate rallied hard in the previous session after the OPEC+ group agreed to production cuts through February and March rather than raising output as was initially expected. WTI trades over $50 per barrel at a level last seen pre-pandemic in February.
The US Dollar is advancing versus the Pakistan Rupee, however it trends lower versus its major peers as the mood in the market is improving as investors focus on the US Senate runoffs in Georgia.
At the time of writing the major US networks are calling a win for Democrat Raphael Warnock. The votes are still being counted for the second seat.
Should the Democrats win both seats President Joe Biden would hold a razor thin majority in the upper house. This means that he would have an easier path to achieving his policy aims such as further stimulus. However, his tiny majority is not expected to be sufficient for market unfriendly reforms such as tax increases and tighter regulation.
As the probability of a Blue sweep increases, the US Dollar has sold off.
Looking ahead US ADP payroll data and Fed minutes will be in focus as investors look for further clues as to the Fed’s next move.
