The rupee continued its slide against the dollar on the currency market on Saturday in the process of slow business due to law and order situation in the city, money experts said. The dollar showed strength versus the rupee but it looks that the rupee may not face further sharp fall due to costlier import payment, they said.
Commenting on the rate cut, currency analysts said that on the one hand, this move would help in reviving the business activity in the country, which is coming down due to lack of basic facilities. Particularly, the private sector is happy but on the other hand, traders has termed 50-basis point cut in the mark-up rate by the State Bank of Pakistan as insufficient and demanded further reduction to bring it down to eight percent.
They said that 50-basis point cut in mark up is meagre and half-hearted attempt to bring the economy on track. They further said that the central bank should reduce the mark-up to eight percent and Bank should have taken some bold step and curtail it to at least 150 basis points. The decrease will hardly improve the local investment scenario.
Many in the money market were expecting an increase in business activity after the State Bank of Pakistan (SBP) move. As a result of sharp fall in the business activity in the country, the SBP during the outgoing year brought down interest rate with gradual pace in its December monetary policy, cut down policy interest rate by 50 basis points to 9.50.
OPEN MARKET RATES: The rupee fell by five paisa in relation to the dollar for buying and selling at 98.40 and 98.60, they said.
The rupee also dropped by 70 paisa versus the euro for buying and selling at Rs 128.90 and Rs 129.90, they said.
At the week-end, the dollar fell from a near nine-month high against the yen and dropped for the fifth straight day against the euro on Friday after a US report on inflation showed prices fell in November for the first time in six months, which should allow the Federal Reserve to stay on its ultra-easy monetary policy path.
The Labour Department said on Friday its Consumer Price Index dropped 0.3 percent last month as a sharp decline in gasoline prices offset increases in other areas. It was also the largest drop since May and followed a 0.1 percent gain in October.
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Open Buying Rs 98.40
Open Selling Rs 98.60
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Open Market Rates: Open Market Rates For Dollar on Saturday.
RUPEE IN LAHORE: Downward trend persisted on the local currency market on Saturday as the rupee continued fall versus the dollar on strong demand, dealers said.
According to the currency dealers, the dollar commenced trading on a positive note and witnessed fresh demand that helped its appreciation against the national currency. The dollar was ended higher at Rs 98.80 and Rs 99.20 on buying and selling side against the overnight closing of Rs 98.50 and Rs 99.00, respectively.
Similarly, the rupee posted a loss of 80-paisa on buying side (Rs 158.50) but it stayed unchanged on selling side (Rs 159.00) against the pound sterling. The pound was purchased and sold at Rs 158.50 and Rs 159.00 as compared Rs 157.70 and Rs 159.00 of Friday, respectively, the dealers added.
RUPEE IN ISLAMABAD AND RAWALPINDI: The rupee remained firm against the dollar on the open currency markets of Islamabad and Rawalpindi on Saturday.
The dollar opened at Rs 97.30 (buying) and Rs 97.40 (selling) against same last rate. It did not observe further change in the evening session and closed at Rs 97.30 (buying) and Rs 97.40 (selling).
Pound Sterling opened at Rs 155.50 (buying) and Rs 156.50 (selling) against same last rate. It did not observe further change in the second session and closed at Rs 155.50 (buying) and Rs 156.50 (selling).
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