Currency: Rupee weakens against dollar

KARACHI: The rupee ended weaker at 90.71/75 to the dollar, compared with Monday’s close of 90.62/70 because of an increase in import payments. The rupee had been supported by remittances from overseas Pakistanis, which totaled $1.16 billion in February. The rupee touched a record low of 91.28 to the dollar in January, dragged down by concerns over higher payments for oil imports and overall economic health. There was also concern about the current account deficit, which widened to $2.952 billion in the first eight months of the 2011/12 fiscal year, compared with $194 million over the same period in the previous year. The current account deficit in February stood at $260 million. In the money market, overnight rates rose to 11.90%, unchanged from Friday’s close, despite a reverse repo conducted by the central bank in which it bought back government paper worth Rs38.10 billion.

Published in The Express Tribune, March 21^st, 2012.