Rupee Halts Losses Against US Dollar After Oil Records Biggest Single-Day Drop in 2 Years

The Pakistani Rupee (PKR) halted losses against the US Dollar (USD) in the interbank market today. It maintained pivot at Rs. 179.25 against the USD during today’s open market session.

It held its own against the USD and closed at Rs. 178.63 today after losing one paisa and closing at 178.63 in the interbank market on Wednesday, 9 March.

The rupee managed to cease losses against the US Dollar after global oil prices sharply declined overnight as market players struggle to locate crude supply streams besides Russia. While the UAE and Saudi Arabia have sufficient capacity, some other members of the Organization of the Petroleum Exporting Countries (OPEC+) are struggling to reach output objectives due to infrastructure underinvestment in recent years, which will limit their potential to increase output further.

Brent crude futures fell as low as $112 a barrel today after trading in a $5 range. The benchmark contract fell by 13.2 percent, its worst one-day plunge in over two years.

West Texas Intermediate (WTI) crude futures in the United States plunged as low as $109 a barrel after trading in a $4 range. The contract had dropped 12.5 percent in the previous session, the most in a single day since November.

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Discussing the local unit’s performance in a tweet earlier today, the former treasury head of Chase Manhattan Bank, Asad Rizvi, remarked that despite the fact that the dollar is in demand, the PKR has managed to trade near historic lows. Uncertainty persists as a result of the ongoing geopolitical risk induced by conflict. Oil prices fell substantially as a result of the Ukrainian President’s readiness to compromise and the UAE’s assistance.

“But Pakistan [still] has many challenges [to face],” he warned.

The PKR reversed gains against most of the other major currencies and reported losses in the interbank currency market today. It lost 38 paisas against the Canadian Dollar (CAD), 42 paisas against the Australian Dollar (AUD), Rs. 1.01 against the Pound Sterling (GBP), and Rs. 2.03 against the Euro (EUR).

Conversely, it held out against both the Saudi Riyal (SAR) and the UAE Dirham (AED) in today’s interbank currency market.

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