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August 12, 2020

Rupee pares losses

Business

August 12, 2020

KARACHI: The rupee recovered from early losses on Tuesday to end the session with marginal gains due to dollar selling by exporters, dealers said.

The rupee closed at 168.26 against the dollar, compared with Monday’s closing of 168.38, after falling to a record low of 168.47 in the session.

In the open market, the rupee gained 30 paisas to close at 168.70 against the dollar.

Dealers said the currency opened weaker on the back of strong dollar demand from importers and corporates and reports about the ending of the Saudi loan and oil supply to Pakistan on deferred payment over Islamabad criticism of OIC on Kashmir.

However, exporters stepped in to sell the greenback to rescue the local unit, dealers said.

“The foreign exchange market has been under pressure from worries about an early repayment of a $1 billion Saudi loan, which points to a deepening rift between the relations of the two countries,” a dealer with a commercial bank said. Pakistan has approached Saudi Arabia to get an extension in a $3.2 billion Saudi oil facility on deferred payments. The government has approached Saudi Arabia for the renewal of the agreement between the two countries on this arrangement, which expired in May this year.

Saudi Arabia in November 2018 offered Pakistan a $6.2 billion package to help stave off an economic crisis. Of the total $6.2 billion financing, a loan worth $3.2 billion was given to Islamabad in deferred payments for oil imports.