Dollar maintained an upward trend on the money market on Friday in the process of trading activity, dealers said. Commenting on the fresh decline in the currency market, marketmen said that rupee continued its slide versus dollar due to a short supply.
INTER-BANK MARKET RATES: The rupee dropped about Rs 3 in relation to dollar for buying and selling at Rs 148.50 and Rs 149.00 respectively, they said.
OPEN MARKET RATES: The rupee also lost Rs 2.50 in terms of the dollar for buying at Rs 148.50 while the local currency shed Rs 2.00 for selling at Rs 149.50, they said. The rupee fell sharply against the euro for buying and selling at Rs 165.50 and Rs 168.80 respectively, they said.
In the final Asian trade, the dollar held near a two-week high against its peers on Friday, supported by strong US economic data and a bounce in Treasury yields.
The dollar index versus a basket of six major currencies stood at 97.836 after reaching 97.882 on Thursday, its highest since May 3.
The greenback reached the two-week peak on robust US housing data and a weekly jobless claims report which pointed to sustained labour market strength in the world's biggest economy.
The US currency also drew strength as its counterparts such as the euro and pound were dogged by bearish factors.
The dollar was available against the Indian rupee at Rs 70.195, the greenback was at 4.173 in terms of the Malaysian ringgit and the US currency was at 6.909 in relation to the Chinese yuan.
Reuters adds: The Pakistani rupee continued to fall to record lows on Friday, after the government agreed in principle to a $6 billion loan from the International Monetary Fund that's expected to set tough conditions on Prime Minister Imran Khan's administration.
The rupee, which lost 3.6 percent on Thursday to close at 146.2 against the US dollar in the interbank market, dropped further on Friday, dealers said, selling at 149.50 in the interbank market and 150 in the open market.
The Pakistan fall reflects the IMF's condition for a "market-based exchange rate mechanism, which will see limited intervention by the central bank now," said Saad Hashemy, chief economist and research director at Topline Securities in Karachi.
Pakistan's stock market also declined on Friday, with the benchmark KSE 100 index down 2.4 percent by 0615 GMT.
While the exact conditions of a final IMF deal are still unknown, Sunday's Staff-Level accord, which must still be approved by the Fund's board in Washington, said a "market-determined" exchange rate would help the financial sector. That pointed to less support from the central bank, which at present underpins the rupee in a de facto managed float system.
Late on Thursday, the central bank issued a statement saying the sharp fall in the rupee "reflects demand and supply conditions in the foreign exchange market" and would help in correcting market imbalances.
However the drop presents a political problem for Khan's government, which came to power last year promising to build a new social welfare system and vowing not to seek what would be Pakistan's 13th bailout since the 1980s.
With the economy facing a sharp slowdown in growth, the government is expected to have to raise taxes or impose heavy spending cuts to reduce its ballooning budget deficit at a time when household budgets are increasingly squeezed.
While many analysts see the rupee as overvalued and say the central bank has wasted billions defending it, a weaker currency is likely to fuel inflation, which is already over 8 percent, with power and fuel prices hit especially hard.
Hashemy noted market talk that oil imports were already facing payment pressure.
The central bank, which is due to announce its latest interest rate decision on Monday, said late on Thursday that its foreign exchange reserves fell $138 million in the week ending May 10 to $8.846 billion, less than needed to cover three months of imports.
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Open Bid Rs.148.50
Open Offer Rs.149.00
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Interbank Closing Rates: Interbank Closing Rates For Dollar on Friday.
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Bid Rate Rs.148.50
Offer Rate Rs.149.50
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RUPEE IN LAHORE: The Pak rupee continued steep fall for the second consecutive day against the major foreign currencies including the greenback and the British pound in the local currency market on Friday.
The short supply phenomenon of the greenback prevailed for another day in the market which helped its further appreciation for buying and selling at Rs 149.50 and Rs 150.50 against the opening trend of Rs 146.50 and Rs 148.50 respectively, local currency dealers said.
Similarly, the national currency also followed the same suit in relation to the pound sterling. Consequently, the pound's buying and selling rates further rose from the Thursday's closing of Rs 186.00 and Rs 187.20 to Rs 188.00 and Rs 190.00 respectively, they added.
RUPEE IN ISLAMABAD AND RAWALPINDI: The dollar continued its upward journey against the Pak rupee at the local currency markets of Islamabad and Rawaplindi on Friday.
The dollar opened at Rs 152 (buying) and Rs 152.10 (selling) against last rate of Rs 148 (buying) and Rs 148.10 (selling). The dollar went up to Rs 155 against the local currency and finally closed at Rs 152 (buying) and Rs 152.10 (selling).
The buying and selling rates of one tola of gold was Rs 68,000 (selling) and Rs 67,800 (buying) in the local Sarafa (gold) markets of Rawalpindi and Islamabad.
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