The Pakistani rupee maintained a stable position against the US dollar in the inter-bank market during the opening hours of trading on Friday. At 10:00 AM, the rupee stood at 279.45 against the greenback, reflecting a slight gain of Re0.01 from the previous day’s closing rate of 279.46.
This stability comes after a period of fluctuating exchange rates, as the rupee has managed to hold its ground in recent days despite ongoing pressures in both domestic and international markets. The modest movement observed in early trading indicates that there is no significant change in market sentiment as of now, with traders remaining cautious in the absence of new developments affecting the currency.
The global forex market also witnessed notable movements on Friday, with the Japanese yen reaching a 2-1/2-month high following a sharp increase in Japan’s inflation rate. The yen surged to as high as 149.285 per US dollar, after Japan reported core inflation running at its fastest pace in 19 months during January. This marked a major shift in market dynamics as traders reacted to the Japanese economic data, sending the yen higher and pushing it through key resistance levels in the process.
Meanwhile, the US dollar was on track to register its third consecutive weekly loss. Traders had initially expected a more aggressive stance from the United States under former President Donald Trump’s second term, particularly regarding tariffs on Chinese goods. However, recent developments suggest that Trump’s trade policies may be more rhetorical than impactful. While Trump has imposed a 10% additional tariff on Chinese goods and has announced plans to reinstate steel and aluminium levies, he has also suspended tariffs on Canada and Mexico, leading to some uncertainty in the markets.
As a result, the US dollar has faced broad losses this week. On Thursday, the US dollar index dropped to its lowest point for 2025, touching 106.29 before recovering slightly to 106.45. The ongoing uncertainty regarding US trade policy has prompted traders to reassess their positions, which has affected the strength of the US dollar.
In addition to these currency movements, the price of oil, a key indicator influencing currency parity, extended its gains on Friday. Both Brent Crude and West Texas Intermediate (WTI) crude oil prices were set for a weekly increase, supported by declining inventories of gasoline and distillates in the US. The market is also concerned about potential supply disruptions from Russia, which further bolstered oil prices. Brent futures climbed by 16 cents, or 0.2%, reaching $76.64 a barrel, while WTI crude edged up by 17 cents, or 0.2%, to $72.65.
The rise in oil prices is noteworthy as it impacts global economic conditions and the stability of currencies. Oil is a major export for several economies, and changes in its price can have a cascading effect on currency markets, including the Pakistani rupee. For now, traders will be closely monitoring developments in the oil markets as they continue to influence global economic trends.
As of now, Pakistan’s currency remains resilient, though it is clear that it is not immune to the external factors affecting global exchange rates. The rupee’s stability in early trading on Friday reflects ongoing caution in the market, with traders remaining alert to potential shifts in both domestic and international economic conditions.