The Pakistani rupee registered marginal improvement against the US dollar, appreciating 0.07% during the opening hours of trading in the inter-bank market on Tuesday.
At 10:10am, the currency was hovering at 277.45, a gain of Re0.19 against the US dollar.
On Monday, the rupee had settled at 277.64, according to the State Bank of Pakistan (SBP).
Internationally, the US dollar clung to seven-week highs against major currencies on Tuesday as investors ponder the outlook for US rates after a strong jobs report last week dashed bets for large rate cuts, while escalating tensions in Middle East dented risk sentiment.
Traders have drastically shifted their monetary easing expectations from the Federal Reserve this year.
Markets are no longer fully pricing in a rate cut in November and are ascribing an 86% chance of a 25 basis points (bps) reduction, the CME FedWatch tool showed.
Just 50 bps of easing is priced in by December, down from over 70 bps just a week earlier.
The US dollar index, which measures the US unit against major rivals, last fetched 102.41, just below the seven-week high of 102.69 it touched on Friday.
Oil prices, a key indicator of currency parity, fell more than $1 on Tuesday as traders took profits from a rally in the previous session that lifted the market to its highest level in over a month amid fears that the Middle East could be on the brink of a region-wide war.
Brent crude futures fell $1.17, or 1.5%, to $79.76 per barrel at around 0420 GMT. US West Texas Intermediate futures fell $1.19, or 1.6%, to $75.95 a barrel.
Both contracts rose over 3% on Monday to their highest levels since late-August, adding to last week’s rally of 8%, the biggest weekly gain in over a year, on worries that escalating hostilities could disrupt oil supply from the Middle East.
This is an intra-day update
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