The increased dollars buying in the final sessions of the current fiscal year for the clearance of dues pushed the greenback rates high in the interbank market as well in the open market last week, experts said.
In the interbank market, the dollar recovered 15 paisa versus the rupee for buying and selling at Rs 58.11 and Rs 58.13.
The rupee followed suit, and shed 17 paisa in the open market for buying and selling at Rs 58.55 and Rs 58.65, moneychangers said, adding it, however, also shed 60 paisa versus the euro for buying and selling at Rs 71.20 and Rs 71.50.
In fact, the dollars supply was short in demand because of debt payments before June 30, market sources said.
Furthermore, market players are predicting that the demand for the dollars might continue even after June 30 due to scheduled loan repayments.
In anticipation of further rise in the dollar's value, several investors held dollar stocks, and also intending to get more, which may be another factor for the shortage of the US currency, they added.
DOLLAR MAY CROSS NEW BARRIER: Widening country's trade deficit and continued dollars' buying by the banks might push the rupee-dollar parity rate at Rs 58.50 in the interbank market, currency experts said.
In the meantime, recently, the State Bank has made it clear that it is in touch with the present developments in the currency exchange regime, and if it feels any odd it would take action to ward off speculative business or artificial rise of the dollar, they said.
Commenting on the rising inflation, they observed that upward trend in the oil prices in the world markets pushed the rates of daily-use items high, which mainly led a rise in inflation rate.
According to the SBP governor, the inflation rate is likely to hit 4.5 or 4.6 percent in the current fiscal year due to the high trend in the commodity items.
Friendly rupee-dollar parity for exporters: Recent appreciation in the dollar's value is no doubt favourable for the exporters to make room in the international markets, they observed, saying recently, the regional currencies depicted falling trend in relation to the greenback, including Indian rupee, which lost around Rs 2 to Rs 26 versus the dollar within the period of two months.
REMITTANCES MIGHT GO UP: Analysts observed that narrowing the interbank and open markets gap likely to encourage the overseas Pakistanis to send money through official channels, they said, adding this would definitely discourage the Hundi business, but on the other hand, there are some fears that opportunists may begin speculative trade of the US currency to shine their business.
It is highly expected that the State Bank to keep a watch on the dollar's recent rise versus the rupee, they said.
Monetary Policy: According to the economic data, the basic fundamentals are signalling of recovery, the central bank may have to tighten its monetary policy slightly to check rising inflation.
According to a news report, the State Bank of Pakistan (SBP) would issue its monetary policy on July 20.
OPEN MARKET RATES: On June 21, the rupee shed three paisa against the dollar for buying and selling at Rs 58.38 and Rs 58.43, while it picked up 30 paisa versus the euro for buying and selling at Rs 70.60 and Rs 70.90 in the process of trading.
On June 22, the rupee-dollar parity rates tumbled with four paisa loss in the open market for buying and selling at Rs 58.42 and Rs 58.47, respectively.
The dollars are short in demand as the interbank market extended greenback demand for some pre-payment requirements, moneychangers said.
In the coming days, they guessed the rupee might slide further ground versus the US currency.
It is also expected that the rupee may touch the new low at Rs 58.50 in the open market, they added.
The rupee, however, gained 10 paisa versus the euro for buying and selling at Rs 70.50 and Rs 70.80.
The dollar fell in the world markets versus the leading currencies in the absence of fresh leads, market sources said, adding the dollar to move in a narrow range ahead of the next week Federal Reserve meetings.
On June 23, the dollar shed three paisa for buying at Rs 58.45 and losing eight paisa for selling at Rs 58.55 on its rising demand, dealers said.
The euro also gained 54 paisa versus the rupee for buying and selling at Rs 71.04 and Rs 71.35, respectively.On June 24, the dollar maintained its surge versus the rupee due to its extending demand by the corporate sector, picking up eight paisa for buying at Rs 58.53 and three paisa for selling at Rs 58.58, dealers said, adding the demand for the dollars is continued, and this trend might push the dollar up to Rs 59 in the open market.
On June 25, the dollar continued its over riding versus the rupee, picking up two paisa for buying and selling at Rs 58.58 and Rs 58.60, dealers said.
The greenback is still in demand following the continued its rise in the interbank market, they added.
The euro also picked up 20 paisa versus the rupee for buying and selling at Rs 70.90 and Rs 71.20.
On June 26, the rupee did not show any sharp variation for buying and selling rates at Rs 58.55 and Rs 58.65.
The rupee, however, shed 30 paisa versus the euro on the buying and selling counters at Rs 71.20 and Rs 71.50, respectively.
INTERBANK MARKET: On Monday, the dollar inched up versus the rupee to touch the new high in the interbank market, gaining one paisa on buying and selling counters at Rs 57.97 and Rs 57.98, respectively.
On Tuesday, as according to the market expectations, the dollar crossed a psychological level of Rs 58 versus the rupee in the interbank market, observers said, adding the dollar gained nearly three paisa in relation to the rupee for buying and selling at Rs 58.01 and Rs 58.03, respectively.
This was the biggest gain in the dollar's value since March 2003, they said, adding the erosion in the rupee's value has brought down the widening gap between the open and interbank markets rates.
On Wednesday, the dollar extended its overnight gains in the interbank market, picking up further 12 paisa for buying and selling at Rs 58.13 and Rs 58.15, market men said.
On Thursday, the dollar maintained its trend versus the rupee, and quoted at Rs 58.11 and 58.13 for buying and selling, respectively.
On Friday, the dollar lost most of the earlier gains following the banks dollar selling for buying and selling at Rs 58.10 and Rs 58.12, respectively.
According to market sources, the dollar touched the new high in the early session on its strong demand for its buying and selling at Rs 58.15 and Rs 58.17 versus the rupee.
On Saturday, the rupee traded in a band of Rs 58.11 and Rs 58.13 amid continued demand for dollars, dealers said.