KARACHI: The rupee depreciated on Friday on increased demand for importers’ dollars for local unit payments.
The rupee closed at .3 160.33 against the close of 160.18 in the interbank market on Thursday.
In the open market, the rupee closed at 160.40 against the dollar. The rupee was fixed at Rs 160.30 in the previous session.
“There was a sudden demand from importers and the corporate sector, which put pressure on the rupee,” said a foreign exchange trader with a commercial bank.
The depletion of the central bank’s foreign exchange reserves has hurt the sentiments of traders.
Forex reserves held by the State Bank of Pakistan fell by 12 12 million to 13 13.400 billion as of January 8.
The rupee has remained relatively stable over the last four sessions with modest appreciation. Silent demand for the domestic currency, strong inflows from exports and remittances, and positive sentiment about the country’s economic outlook helped.
Another trader said, “Although the forecast of Rs 160-160.50 for this week was not violated, we were expecting it to strengthen further by the end of the week.”
“We can expect the rupee to trade in the current range next week, but if the market pays off, the demand for the rupee could increase further,” he added. He said that the rupee will hover in the band of 160.25 to 160.75 next week.