Currency: Rupee strengthens against dollar

KARACHI: The rupee ended steady at 97.18/97.23 against the dollar on Monday. The currency market and money markets were closed on Tuesday due to a bank holiday. The rupee has been under pressure due to import and oil payments and may fall further due to strong demand for the dollar from importers, a dealer said. The rupee has also remained under pressure due to debt servicing to the International Monetary Fund (IMF). The country has to pay $3.4 billion in 2012-13, $3.43 billion in 2013-14 and $1.35 billion in 2014-15 to retire the loan. The country’s foreign exchange reserves will continue to face pressure due to debt servicing in the next three years. According to reports, a balance of payment crisis is being predicted after March 2013, as the country’s forex outflows are likely to remain at $1 billion per month. Overnight rates in the money market had ended at 8% on Monday.

Published in The Express Tribune, January 2^nd, 2013.                

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