Rupee below 290 against US dollar

The Pakistani rupee gained 0.37% against the US dollar during the first hours of trade in the interbank market on Tuesday.

At 10:10 a.m., the rupee was trading at 289.78, up Rs1.08 in the interbank market.

The rupee gained 0.31% on Monday, closing at 290.86.

In recent days, the rupee has sustained its upward trend, recovering about 6% after hitting a record low of 307.1 against the US dollar in the inter-bank market on September 5.

Internationally, the US dollar held 10-month highs versus a basket of major currencies on Tuesday, aided by US bond rates reaching 16-year highs, as the yen edged closer to the intervention danger zone.

The 10-year Treasury yield rose more than 45 basis points in September, above 4.5% for the first time since 2007. This is due to a mix of solid economic statistics, hawkish Federal Reserve language, and a budget deficit to be funded by borrowing.

Rates markets are pricing in a nearly 40% likelihood of another Fed raise this year, against lower possibilities of another rise in Europe, and the disparity has helped support a dollar that many had predicted would fall sharply once short-term rates peaked.

Oil prices, a crucial measure of currency parity, dipped on Tuesday amid concerns that major central banks will keep interest rates higher for longer, even if supply is projected to be constrained.