Rupee loses ground against US dollar

Pakistan’s rupee started off the week on a negative note, depreciating 0.14% against the US dollar in the inter-bank market on Friday, as high oil prices weighed in on market sentiment.

As per the State Bank of Pakistan (SBP), the rupee closed at 176.49 after a day-on-day depreciation of 25 paisas or 0.14%. The fall comes after the rupee ended the previous week on Friday with a gain against the US dollar.

Rupee breaks losing streak, gains against US dollar

The latest fall comes as oil prices rose on Monday on worries about supply disruption amid rising tensions in Eastern Europe and the Middle East, which could make an already tight market even tighter, while OPEC and its allies continued to struggle to raise output.

Brent crude futures rose 81 cents, or 0.9%, to $88.70 a barrel, reversing a 0.6% loss on Friday.

Oil prices are directly related to sentiment around the currency as expensive imports contribute to deterioration in Pakistan’s current account, putting pressure on the rupee.

Pakistan reported a current account deficit of $1.93 billion on Saturday, a marginal 2% increase on a monthly basis.

Meanwhile, the SBP also decided to keep the interest rates unchanged at 9.75% on Monday.

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