The Pakistani Rupee (PKR) posted a notable gain against the US Dollar on Monday, reflecting ongoing stability in the local currency market alongside favorable global developments.
As of 11:40 AM, the rupee was trading at 282.72, marking a gain of Re0.73 or 0.25% during early hours in the interbank market.
According to AKD Securities Limited, the rupee had already appreciated 0.50% during the previous week, which was the strongest weekly gain in 93 weeks. The local currency had closed at 283.45 on Friday, compared to 284.87 a week earlier.
Global Trade Agreements Lift Sentiment
The upward trend in the rupee coincides with positive global trade news. On Sunday, US President Donald Trump and European Commission President Ursula von der Leyen announced a framework trade agreement at a summit in Scotland. The deal imposes a 15% tariff on EU goods—half the initially proposed 30%—easing concerns of a full-blown trade war.
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The agreement sparked strength in global currencies and equity markets, particularly boosting the euro, which rose to $1.1763 in early Asian trading and gained against the yen as well.
“The agreement is expected to unlock over $600 billion in EU investments into the US,” President Trump stated, noting increased European purchases of American energy and military equipment.
Investor Focus on Central Bank Moves
Attention is now shifting to major central bank meetings this week. Both the Federal Reserve and the Bank of Japan are expected to hold interest rates steady, but investors are keenly awaiting policy statements for future direction.
Despite strong economic data from the US on Friday, the dollar index fell 0.1% to 97.534, providing some breathing room for emerging market currencies like the PKR.
Oil Prices Add Support to Emerging Currencies
Oil prices, which significantly affect Pakistan’s trade balance and currency strength, also saw an uptick:
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Brent crude rose 22 cents to $68.66 per barrel
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WTI crude climbed to $65.38, up 22 cents
The gains were linked to improved trade sentiment, particularly hopes of a US-China tariff truce as negotiators meet in Stockholm later today.
What It Means for Pakistan
A stronger rupee not only eases import costs but also reflects increased investor confidence, especially in the backdrop of stable oil prices and favorable global trade dynamics. If macroeconomic indicators continue to support this momentum, the PKR could further consolidate in the coming weeks.
Further Links: State Bank of Pakistan – Exchange Rates