Rupee weakens

The rupee fell five paisas against the dollar on Thursday, owing to demand for import payments. It ended at Rs139.49 against the greenback from the previous day’s closing of Rs139.44 in interbank foreign exchange market.

Currency dealers said the demand for import payments escalated the demand for the dollar. The upcoming weekly holidays and month-end payments also kept pressure on the demand side, they added.

The interbank foreign exchange market initiated the day in the range of Rs139.48 and Rs139.50. The market recorded the day’s high of Rs139.50 and the low of Rs139.49.

In the open market also, the rupee declined sharply by 40 paisas. The dollar’s buying and selling was recorded at Rs139.70/Rs140.20, compared with Rs139.30/Rs139.80 in the cash ready market.

Open market dealers said foreign educational fee and expenses on Hajj-related issues increased the demand for the dollar.

Currency experts said the shrinking current account deficit and trade deficit would help the local unit maintain current levels.

However, the decision of the government to enter new IMF loan could deteriorate the rupee value in the future.

The current account deficit of the country reduced to $8.84 billion during the first eight months of the current fiscal year, compared with the deficit of $11.42 billion in the corresponding months of the last fiscal year.