- Pakistan Rupee (PKR) heads lower on lockdown concerns
- FDI falls again in March
- US Dollar (USD) slips as fears over tax hikes ease
- US manufacturing and service sector PMI data in focus
The US Dollar Pakistan Rupee (USD/PKR) exchange rate is on the rise on Friday for a second straight session. The pair settled +0.46% higher at 153.20. At 11:00 UTC, USD/PKR trades +0.28% at 153.62.
The Pakistan Rupee remains under pressure as concerns over the covid picture rise. Prime Minister Imran Khan warned that Pakistan could face a situation similar to India soon if restrictions are not adhered to. Restrictions have been placed on restaurants, gyms have closed and the army has been called in to help implement the restrictions.
The resurgence of covid is doing little to help foreign direct investment. Data from the State Bank of Pakistan revealed that FDI flows were down again in March year on year, some 40%. In the 9 months of the fiscal year FDI is down 35%.
The US Dollar is trades higher versus the Rupee. However, the US Dollar is trading lower versus its major peers. The US Dollar Index, which measures the greenback versus a basket of major currencies trades -0.33% at the time of writing at 91.02 close to its 7 week low hit earlier in the week.
The US Dollar is edging lower paring gains from the previous session. The US Dollar rose on Thursday following better than forecast US jobless claims data and reports that the Biden administration could look to raise capital gains taxes to 40% for wealthy Americans.
Today the greenback is easing off whilst US stock futures are moving higher. This suggests that the market is less nervous about the hikes.
Looking ahead US PMI data will be in focus for both the service sector and the manufacturing sector. The manufacturing sector has outperformed across the pandemic and is expected to improve again in April. However the real focus will be on the service sector as the economy reopens. Analysts expect activity in the service sector to roar higher to 61.5in April.
