Rupee inches up to 279.25 against dollar

Pakistani rupee posts marginal gain as dollar eases slightly, while global currency markets remain volatile amid central bank signals and Middle East tensions.

The Pakistani rupee strengthened marginally against the US dollar in the inter-bank market on Thursday, closing at 279.25, up by Re0.01 from the previous session’s close of 279.26. The minor appreciation reflects relative stability in the currency market despite continued external pressures and global volatility.Pakistani Rupee Gains Slightly Against Dollar

Currency dealers said the rupee traded in a narrow band during the session, supported by balanced demand and supply conditions in the interbank market. The local unit has remained largely range-bound in recent weeks, as import payments, remittance inflows, and central bank management keep volatility in check.

The rupee’s stability comes as Pakistan continues to manage external account pressures under an International Monetary Fund programme aimed at stabilising foreign exchange reserves. According to State Bank of Pakistan data, the country’s reserves have shown gradual improvement in recent months, supported by multilateral inflows and a contained current account deficit.

Globally, currency markets remained volatile as the US dollar hovered near multi-month highs, supported by expectations that the Federal Reserve will keep interest rates elevated for longer. The US dollar index, which measures the greenback against a basket of six major currencies, eased slightly by 0.1% to 100.07 but remained close to its highest level in four months.

Market expectations suggest the US central bank will hold rates steady at its upcoming meeting, with any potential easing pushed further into the future. According to CME Group’s FedWatch tool, the probability of a rate cut later this year remains uncertain, with December odds roughly balanced, while expectations for meaningful easing have shifted toward 2027.

The Japanese yen also remained under pressure, trading near its weakest level in two years despite a slight recovery to 159.655 per dollar. The Bank of Japan maintained its policy rate at 0.75%, signalling continued accommodative monetary policy even as inflationary pressures persist globally. Japanese authorities have expressed concern over speculative activity driving currency volatility, highlighting broader instability in foreign exchange markets.

Oil prices, a critical factor for Pakistan’s external balance and currency outlook, surged sharply amid escalating geopolitical tensions in the Middle East. Brent crude rose above $113 per barrel during the session, briefly touching over $115, marking its highest level in more than a week. US West Texas Intermediate crude also gained, reflecting heightened supply concerns after attacks on regional energy infrastructure.