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Pakistani Rupee Gains on Saudi Arabian Loan Promise

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The Pakistani rupee has experienced significant gains against the US dollar, climbing 1.21% in the inter-bank market on Thursday after reports of expected inflows from Saudi Arabia. The currency closed at 284.42, up by Rs3.43. This followed a new record low of 287.85 in the inter-bank market on Wednesday. The Saudi Arabian government has confirmed it will provide a $2 billion loan to Pakistan, a move which is crucial for the debt-ridden South Asian economy.

However, the International Monetary Fund agreement still hinges on a similar commitment from the United Arab Emirates for a $1 billion loan. Globally, the US dollar has slightly gained, but not strayed far from a recent two-month low as traders consider the impact of Federal Reserve policy following US jobs data. Weak economic data has added to fears of an impending recession in the world’s largest economy, putting a lid on risk appetite and sending traders in search of safe-haven assets. The US dollar index was up 0.1% at 101.95. Oil prices fell on Thursday as weak US economic data raised concerns over potential global recession and demand reduction.

In the open market, the Pakistani rupee gained one rupee for both buying and selling against the US dollar, closing at 291.50 and 294.50, respectively. Against the Euro, it gained four rupees for both buying and selling, closing at 314 and 317, respectively. Against the UAE Dir ham, the Pakistani rupee lost 10 paisa for buying and remained unchanged for selling, closing at 79.30 and 80.00, respectively. Against the Saudi Riyal, it gained 90 paisa for both buying and selling, closing at 76.80 and 77.50, respectively.

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