ISLAMABAD: The Rupee on Friday depreciated by 10 paisa against the US Dollar in the interbank trading and closed at Rs280.71 against the previous day’s closing of Rs280.61.
However, according to the Forex Association of Pakistan (FAP), the buying and selling rates of the dollar in the open market stood at Rs280.75 and Rs282.25, respectively.
The price of the Euro decreased by 14 paisa to close at Rs319.17 against the last day’s closing of Rs319.31, according to the State Bank of Pakistan (SBP).
The Japanese yen went up by 01 paisa and closed at Rs1.97, whereas an increase of 77 paisa was witnessed in the exchange rate of the British Pound, which was traded at Rs372.38 as compared to the last day’s closing of Rs371.61.
The exchange rates of the Emirates Dirham and the Saudi Riyal increased by 03 paisa each to close at Rs76.42 and 74.81 respectively.
The United States Dollar (USD) is the official currency of the United States and a pillar of the world financial system. Its origin goes back to the Coinage Act of 1792, but its rise to global fame gained momentum after World War I and was consolidated by the Bretton Woods Agreement of 1944. Under this agreement, other leading currencies were tied to the US Dollar, which itself was tied to gold, making the dollar the major reserve currency. Though the direct gold peg was subsequently discarded, the dollar’s established status and the dominance of the US economy and financial markets have helped to maintain its preeminence in international finance.
The US Dollar is absolutely vital to global trade because it is the world’s leading reserve currency. Central banks worldwide keep large proportions of their foreign exchange reserves in US Dollars, which provides a steady demand to sustain its value and liquidity. In addition, most international transactions, especially for major commodities such as oil and gold, are denominated and settled in US Dollars. Such extensive use makes international trade easier through less frequent necessity for currency exchange, thus diminishing costs of transaction and increasing the efficiency of the international market.
