Rupee falls

KARACHI: The rupee slid to a near-three-month low on Wednesday, continuing to build losses as panic buying from importers on fears of re-imposition of intermittent lockdown weighed on the currency.

In the interbank market, the rupee closed at 165.71 to the dollar after dipping to 165.54, a level last seen on March 27, 2020. It had settled at 164.87 on Tuesday. Dealers said dollar demand from importers was seen in the past few days, as companies bought greenback to settle payments, while fears of further decline in rupee value also encouraged investors to build up dollar positions.

“Sentiments are worse as market participants expect the government to tighten coronavirus restrictions again to stop record infection cases in the country,” said a forex dealer.

Besides that falling foreign exchange reserves, higher debt repayments and lack of dollar inflows have all been factors behind the drop in the value of the rupee these days, he added. The rupee also lost grounds against the dollar in the open market. It closed at 165.90 versus the greenback, compared with previous close of 165.70.