Rupee falls to 278.76 per dollar in interbank

KARACHI: The rupee dropped on Wednesday due to persistent dollar demand from importers and weak supplies, dealers said.

In the interbank market, the rupee ended at 278.76 to the US dollar, compared with Tuesday’s closing rate of 278.7.Dealers said the local unit fell for the third consecutive session on the back of dollar buying from importers, while inflows from exporters and remittances were not adequate to meet the demand in the market.

The rupee also lost ground in the open market. It was trading at 280.25 per dollar, down from 280 in the previous session.However, some positive economic news helped prevent the rupee from declining further during the session. The trade deficit narrowed by 4.2 percent to $3.58 billion in the first two months of the current fiscal year. Exports also saw a 14 per cent growth, reaching $5 billion.

Oil prices have declined in international markets, with WTI crude falling below $70 per barrel. Recent high oil prices, driven by ongoing tensions in the Middle East, have softened due to slowing demand from global economies, particularly China, said Chase Securities in a note.

“This decline is favourable for Pakistan’s external account and is expected to contribute to easing inflation in the coming months,” it said.Attention is now focused on the upcoming monetary policy meeting and the finalization of the IMF programme. Both the prime minister and the finance minister reassured in their media briefings that work on the programme is progressing and is expected to be finalized soon, it added.