Key Takeaways
- Pakistani rupee appreciates 0.01% against US dollar in interbank market.
- Finance Minister Muhammad Aurangzeb held a meeting with IMF mission.
- US dollar nears two-month high due to volatile oil prices and Treasury yields.
The Pakistani rupee has recorded a marginal gain of 0.01% against the US dollar in the interbank market, closing at 277.12, a rise of Re0.03 from the previous day's rate of 277.15.
Finance Minister Muhammad Aurangzeb convened a kick-off meeting with the International Monetary Fund (IMF) mission on Tuesday, as part of ongoing reviews of Pakistan's Extended Fund Facility (EFF) and Resilience and Sustainability Facility (RSF) arrangements.
Internationally, the US dollar has reached a two-month high, supported by volatile oil prices and rising Treasury yields, although gains were limited as traders await US data for clues on the Federal Reserve's rate path.
The euro traded near its weakest level in three months at $1.1367, following the European Central Bank's chief who signalled measured steps to combat inflation.
Sterling was steady at $1.3248, close to a three-month trough, while the dollar index, measuring the US currency against a basket of peers, was slightly higher at 101.2, on track for a 1.8% advance this month, its best performance since June.
A deepening selloff in US Treasuries pushed yields to new peaks, with the 10-year benchmark at its highest since 2007 and the 30-year at its highest since 2004. The monetary policy-sensitive two-year yield also rose to its highest in more than two years, closing in on 5%.
Markets are now seeing a more than 70% chance of a rate hike from the Federal Reserve at the end of October, up from 57% a week ago, according to CME Group’s FedWatch tool.
Oil prices, a key indicator of currency parity, declined on Tuesday as investors focused on signs of recovering crude exports from the Middle East and lingering concerns over potential supply disruptions in the region stemming from the US-Israeli war on Iran.
Brent crude futures fell $1.96, or 1.86%, to $103.32 a barrel at 1306 GMT, while US West Texas Intermediate crude was at $90.65, down $1.95, or 2.11%.
