Currency: Rupee strengthens against dollar

KARACHI: The rupee ended firmer on Wednesday at 90.21/28 to the dollar, compared to Tuesday’s close of 90.30/35, amid lack of import payments. The rupee fell to a record low of 91.28 to the dollar in intra-day trade last week. Analysts say concerns about the country’s economic health, especially a weakening current account, are adding to pressure on the rupee. The current account recorded a provisional deficit of $2.15 billion in the first six months of the 2011/12 fiscal year, compared with a surplus of $8 million in the same period last year, according to data from the State Bank of Pakistan. The deficit is likely to widen further in the coming months because of debt repayments and a lack of external aid. In the money market, overnight rates rose to 11.90 per cent, compared with Tuesday’s close of between 9.25 percent and 9.75 per cent, because of tight liquidity in the interbank market.

Published in The Express Tribune, January 19^th, 2012.