The rupee continued downward trend against the dollar on the money market on Saturday, dealers said.
The rupee breached the barrier of Rs 127 versus the dollar due to persistent demand for the US currency and now the rupee is marching towards 128 levels, money experts said.
Besides, State Bank of Pakistan (SBP) has increased its main interest rate by 100 basis points to 8.5 percent on Saturday, citing rising inflation and economic worries over the large fiscal and current account deficits.
OPEN MARKET RATES: The rupee extended overnight falls, dropping 40 paisas more in terms of the dollar for buying and selling at Rs 126.20 and Rs 126.80 respectively, they said. The national currency slid, losing sharply in relation to the euro for buying and selling at Rs 146.50 and Rs 148.50, they said.
In the final US trade, the dollar climbed to a two-week peak versus a basket of currencies on Friday, boosted by gains against the euro amid concerns about the Italian budget and a US interest rate outlook that reflects multiple rate hikes until 2020.
The US dollar also rose to a nine-month high against the yen. As the third quarter winds down, the dollar index, a gauge of its value against six major currencies, was on track to post its second consecutive quarterly gain of about 0.7 percent. For the last six months, the greenback has advanced nearly 6 percent.
"The US dollar remains a metaphorical rock in a sea of troubles," said Karl Schamotta, director of global product and market strategy at Cambridge Global Payments in Toronto.
"The growth outlook for other Group of 10 countries and the emerging markets remains uncertain, and increased confidence in the forces compelling the Federal Reserve to hike rates next year is helping to lift the US dollar against its counterparts," he added.
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Open Bid Rs.126.20
Open Offer Rs.126.80
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RUPEE IN LAHORE: The Pak rupee registered reduction versus the major foreign currencies including the US dollar and British pound in the local currency market on Saturday.
According to currency dealers, the short supply phenomenon of the US dollar prevailed for another day in the market which helped its further appreciation for buying and selling at Rs 126.20 and Rs 127.20 against the overnight closing trend of Rs 125.95 and Rs 126.20 respectively.
Likewise, the local currency also followed the same suit versus the pound sterling. The pound's buying and selling rates rose from Friday's closing of Rs 163.40 and Rs 164.80 to Rs 163.90 and Rs 165.50 respectively, they added.
RUPEE IN ISLAMABAD AND RAWALPINDI: The dollar witnessed an increase of 70 paisas against the rupee at the open currency markets of Islamabad and Rawalpindi here on Saturday.
The dollar opened at Rs 126.40 (buying) and Rs 126.50 (selling) against last rate of Rs 125.70 (buying) and Rs 125.80 (selling). It closed at Rs 126.40 (buying) and Rs 126.50 (selling).
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