Rupee weakens

KARACHI: The rupee closed weaker on Wednesday on the back of increased dollar demand for import payments, dealers said.

In the interbank market, the rupee ended at 175.04 per dollar, 0.42 percent lower than the previous close of 174.30.

The rupee also lost 50 paisas to settle at 177 to the dollar in the open market.

Dealers said the local unit gained ground in the previous two sessions as the uncertainty regarding the IMF bailout had ended, providing support to the local unit. However, fresh surge in the dollar demand from importers again put pressure on the local unit.

“The dollar buying to make payments pushed the rupee down,” said a currency dealer.

Dealers said the current pressure on the domestic currency is short-lived and the rupee could rise 170 levels in the near-term.

Completion of the sixth review would make available $1 billion, bringing total disbursements under the Extended Fund Facility to about $3 billion and helping unlock significant funding from bilateral and multilateral partners. This will help Pakistan in getting and rollover of funding from bilateral and multilateral partners, which will provide much needed support to rupee.