Rupee hits another low of Rs121.39

KARACHI: The rupee continued to lose value against the US dollar for the fourth consecutive day on Thursday as it settled at yet another low of Rs121.39 in the interbank market due to growing demand from the importers, dealers said.

The dealers said the rupee, which traded at 122.75 per dollar earlier in the day, recovered to close at 121.39, but closed weaker from the Wednesday’s level of 120.39 as demand of dollars from the importers to make payment before Eid holidays ramped up.

“It [rupee] dipped Re1 against the dollar at the close of interbank market,” a dealer said. “The 122.65/75 was a record low for the currency.”

A currency dealer said there was a growing demand of dollars from importers on account payments pressure ahead of Eid.

Traders said the market remained volatile as exporters were reluctant to offload their proceedings.

The rupee has depreciated 5.3 percent so far this week and 15 percent since December last year.

The State Bank of Pakistan (SBP) continued to maintain its stance of non-intervention in the market.

“It’s still not clear what would be the trend for the rupee in the times ahead,” a dealer said. “However, we expect the rupee to trade below the 122 level next week.”

The rupee has been under pressure since the start of this week after the SBP stopped defending the currency’s stability, and let it devalue to ease pressure on the balance of payments position.

The rupee slumped 3.8 percent on Monday in what appeared to be the third currency devaluation by the central bank in seven months amid fears of a balance of payments crisis.

The local unit continued to shed value in the open market as well. It traded at 122.50 for buying and 123.50 for selling against the dollar. The rupee hovered at 121/122 in previous session.