Currency: Rupee weakens, overnight rates fall

KARACHI: The rupee weakened to 85.97/86.03 to the dollar, from Friday’s close of 85.88/92, due to increased dollar demand for import payments. The rupee hit a record low of 86.50 last month, but dealers said the local unit is expected to stay largely stable in the coming days because of increased remittances from Pakistanis working abroad. According to official data, remittances crossed $10 billion for the first time, hitting $10.1 billion in the first 11 months of the 2010-11 fiscal year, an increase of 25 per cent compared with the same period last year. In the money market, overnight rates fell to end at 11 per cent, compared with Saturday’s close of between 12.50 and 13 per cent, amid increased liquidity in the interbank market.

Published in The Express Tribune, June 28^th, 2011.