Pakistan Rupee (PKR) has suddenly depreciated by almost 7% from 110.5 earlier to 118 today against USD.
As per recent conversations with market participants, SteelMint learned that Pakistan steel markets have surprised today over sharp currency depreciation. Most of the trade participants got confused and kept seeking for clear direction on the impact of currency devaluation.
PKR has depreciated Rs. 7.5 against the USD to Rs 118 in a matter of hours, today morning in the inter-bank market compared to its closing rate of Rs 110.5 on Monday.
“Pakistan market stands confused on currency depreciation and turned in ‘Wait and Watch’ mode to analyze the impact of abrupt currency depreciation today. This is likely to hit domestic market unfavorably more than imported scrap market.” shared a source.
This is the second significant devaluation of the Pakistani rupee observed by State Bank of Pakistan in just three months’ period. Earlier to this, in Dec’17 month Pakistani rupee had depreciated by around 4-5% to 110.5, before which one dollar was traded at a rate of around Rs.105.
Imported scrap prices moved up slightly in yesterday’s deal –
In the recent deals concluded, minor quantities of UK origin Shredded 211 scrap in containers sold at around USD 403-404/MT, CFR Pakistan levels. While HMS 1 from Dubai traded at around USD 387-390/MT, CFR Port Qasim.
“Very few thin trades for imported scrap were noted yesterday. However, fresh offers are yet to receive after currency depreciation.” Shared a source.
Offers for HMS 1 in containers from UAE assessed in the range of USD 387-390/MT and HMS 1&2 (80:20) assessed at around USD 385/MT, CFR Port Qasim respectively. While no bulk offers heard again this week.
Towards closing of last week few trades were concluded for Shredded at around USD 395/MT, CFR in containers. On W-o-W basis, imported scrap prices in Pakistan have increased by around USD 10/MT.
Scrap inventories with Pakistan steelmakers are still low and present demand for scrap is quite good in Pakistan.
Ship breaking prices in Pakistan remained stable last week at USD 450/LDT for general dry bulk cargo and at USD 460/LDT for containers on CNF Pakistan basis.
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