Pakistan

Currency: Rupee weakens, overnight rates fall

Dealers say incoming remittances should support the rupee.

Reuters May 18, 2011 Less than a minute read

KARACHI: The rupee ended weaker at 85.47/52 to the dollar compared with Monday’s close of 85.37/42 because of import payments, but dealers said incoming remittances should support the rupee and it should remain around these levels.

Remittances from overseas Pakistanis increased by 23.81 per cent to more than $9 billion in the first 10 months of the 2010/11 fiscal year, with $1.03 billion received in April, according to the State Bank of Pakistan.

In the money market, overnight rates fell to between 12.75 per cent and 13 per cent, compared with Monday’s close of 13.90 per cent after the SBP conducted a three-day reverse repo and bought government paper worth Rs22.65 billion ($265 million).

Dealers said they were awaiting the treasury bill auction scheduled for Wednesday in which they expect cut-off yields to rise marginally.

Published in The Express Tribune, May 18^th, 2011.