As per the State Bank of Pakistan (SBP), the rupee closed at 175.47 after a day-on-day appreciation of 76 paisas or 0.43%. On Friday, the currency had gained 16 paisas to finish at 174.71.

During the previous week, the rupee remained largely stable, ending only marginally 0.13% lower as uncertainty around the International Monetary Fund (IMF) programme settled.

However, as tensions escalated between Russia and Ukraine, the rupee felt the effect as well. Oil prices also inched higher to hover around $95 a barrel as comments from the United States about an imminent attack by Russia on Ukraine rattled global financial markets.

“Super-cycle of commodities will not normalise unless the Russia-Ukraine situation is resolved,” Saad Hashmey, Executive Director at BMA Capital, told Business Recorder.

Hashmey said that the situation is not good for countries like Pakistan, which is an importer of commodities and will witness pressure.

Oil prices became steady after hitting their highest in more than seven years on fears that a possible invasion of Ukraine by Russia could trigger US and European sanctions that would disrupt exports from one of the world's top oil producers.

Brent crude was down 12 cents, or 0.1%, at $94.32 a barrel by 0844 GMT, after earlier hitting a peak of $96.16, the highest since October 2014.

Meanwhile, Hashmey also expressed concern over the upcoming wheat-induced inflation, as Russia and Ukraine account for a quarter of world grain exports. “For a net-importing country, it is going to be tough,” he said.

“At the same time, on a REER basis, the rupee is fairly valued unless oil rallies significantly,” added Hashmey.

Looking at media reports, the attack by Russia on Ukraine seems likely, said one analyst on condition of anonymity.

“The imposition of sanctions on Russia, the world's third-largest crude oil exporter, would wipe out 10% of the oil in the overall market, pushing oil prices to $110 per barrel,” said the market analyst.

“This would translate to an increase of import bill by $3 billion.”

The analyst added that prices of other commodities will also go up.