- Pakistan Rupee (PKR) advances, Karachi 100 rallies for third day
- Trade deficit widens, breaching annual target
- US Dollar (USD) falls after ADP payrolls miss forecast
- US jobless claims and Challenger job cuts in focus
The US Dollar Pakistan Rupee (USD/PKR) exchange rate is extending losses on Thursday for a second straight session. The pair settled -0.3% lower on Tuesday at 152.91. At 11:00 UTC, USD/PKR trades -0.4% at 152.25 towards the low of the day.
The Rupee is again tracing domestic equities higher. The Karachi 100 benchmark index is rallying for a third consecutive day, gaining over 2% so far this week thanks to upbeat quarterly earnings.
According to the Pakistan Bureau of Statistics, Pakistan’s trade deficit widened to $23.8 billion in April. Across the 10 months of the fiscal year so far the trade deficit has already exceeded the annual target by $4.1 billion.
The government had set a target for trade deficit at $19.7 billion. However, this has already been breached due to sluggishness in exports.
Exports rose to $20.9 billion in July – April FY21 compared to $18.4 billion in the same period last year – an increase of 13.5%. Imports, however, rose 17.7% to $44.7 billion.
The US Dollar is falling across the board. The US Dollar Index, which measures the greenback versus a basket of major currencies trades -0.3% at the time of writing at 91.02 after hitting a two week high in the previous session.
The US Dollar is coming under pressure as investors remain focused on data ahead of tomorrow’s closely watched non-farm payroll.
Yesterday, the ADP Employment report revealed that 742,000 new private sector jobs were created in April as the economy reopened. This was just shy of Wall Street’s forecasts of 860,000 but was still the strongest month since September.
Today the labour market remains in focus with the release of initial jobless claims and the Challenger job cuts data. These numbers will help investors and the Federal Reserve alike to asses the health of the US labour market.
Friday’s non-farm payroll is expected to show that almost a million jobs were created in the US in April.