Rupee weakens

KARACHI: The rupee weakened against the dollar on Monday, as business activity resumed after extended holidays, dealers said. In the interbank market, the rupee closed at 152.60/dollar, 0.21 percent down from the previous close of 152.28.

In the open market too, the rupee lost value against the dollar. It ended at 153.20 against the dollar, compared with 152.80 on May 7 (Friday). Dealers said the domestic currency faced a downside pressure due to strong demand for the hard currency from importers and the companies, as the market opened after a weeklong holiday.

The financial markets remained closed from May 10 to 15 on account of Eid-ul-Fitr holidays. “Today, the demand was higher and the inflows were not enough to cater to that demand,” a currency dealer said.

“The rupee traded as low as 152.80 against the dollar during the session,” the dealer added. “The rupee is likely to remain under pressure at least for couple of next few sessions, although the extent of any weakness will depend on the level of the dollar demand from importers, inflows position, especially remittances, and the upcoming budget-related news flow.”

The rupee had been rising due to better supplies, amid Ramazan-related remittances. Remittances from overseas Pakistani workers usually go up during Ramazan and Eid. A slowdown in the importers’ demand had also supported the local unit.