Currency: Rupee weakens, overnight rates higher

KARACHI: The rupee weakened to 86.15/19 to the dollar from 86.12/18 on Wednesday, amid high dollar demand from importers. Dealers said healthy remittances from Pakistanis living abroad had been supporting the rupee in previous trading sessions, but cautioned that a widening current account deficit means the local currency could experience downward pressure in the days ahead. Pakistan’s current account deficit surged to a provisional $908 million in September, compared with a deficit of $201 million in August. In the money market, overnight rates ended higher at 11.90%, compared with the previous day’s close of 11.75%, as there were scheduled outflows of around Rs300 billion ($3.48 billion) against inflows of Rs215 billion.

Published in The Express Tribune, November 4^th, 2011.