Persistent Strengthening of the Indian Rupee Against the U.S. Dollar
The Pakistani rupee appreciated by 0.03% against the US dollar on Thursday, closing at Rs 282.87 for buying and offering Rs 283.07. This modest gain comes amidst a steady US dollar, with the dollar index at 99.77.
In the inter-bank market, the US dollar remained steady, with the dollar index reflecting no significant changes. However, the US dollar is on track for its first monthly gain for the year, with the dollar index set for a monthly gain of over 3%.
The US West Texas Intermediate crude for September gained 37 cents to $70.37 a barrel, while Brent crude futures for September delivery rose 27 cents to $73.51 a barrel. Oil prices have been on a four-day winning streak, with prices continuing to rise on Thursday.
In the open market, the Pakistani rupee saw mixed results. Against the US dollar, the rupee lost 62 paise for buying and remained unchanged for selling, closing at 284.32 and 285.50, respectively. However, against the Euro, the Pakistani rupee gained 2.43 rupees for buying and 3.32 rupees for selling, closing at 325.25 and 326.50, respectively.
The Pakistani rupee's performance against the US dollar can be attributed to the Federal Reserve's monetary policy and the rising oil prices. The Fed's policy, focused on managing inflation, has strengthened the US dollar, attracting foreign capital and putting downward pressure on emerging market currencies like the Pakistani rupee.
India, a major oil importer, has also been impacted by the rising oil prices. The increased demand for foreign currency to pay for crude imports has put pressure on the rupee, contributing to its depreciation against the US dollar.
Looking back, since March 2025, the Indian rupee (INR) has generally weakened modestly against the US dollar (USD), reflecting a gradual depreciation of the rupee. The INR to USD exchange rate hovered near 0.0114 to 0.0116 USD per INR during this period.
In the midst of these economic fluctuations, the Pakistani rupee has managed a slight appreciation against the US dollar, offering a glimmer of stability in an otherwise volatile market.
- In contrast to the US dollar's predicted monthly gain of over 3% as indicated by the dollar index, the Pakistani rupee showed a slight appreciation against the US dollar.
- For investors considering trading in the Pakistani business industry, understanding the impact of the Federal Reserve's monetary policy and global oil prices on the rupee could provide valuable options for future investing decisions.
- As oil prices continue to rise, putting pressure on major oil importers like India, the Pakistani rupee's performance against the US dollar, despite its recent appreciation, may face additional challenges in the future.
