KARACHI : With international oil price on an upward path and lower than expected forex inflows in June, the Pak rupee on Saturday came under fresh pressure, touching an all time low of Rs 70.15 to one dollar to finally close at Rs 70.14 against the greenback.

On the contrary, there were plenty of dollars available with exchange companies and money changers at Rs 70 to dollar but strictly against cash, despite Rs 69.70 and Rs 69.60 rates for sell and buy against the dollar on display board.

With political uncertainty persisting and the financial capitals business community lamenting about the economy being on a downward slope before President Pervez Musharraf on late Friday night amid growing realisation that there is not much the President could do about it added to the existing jittery conditions. Pak rupee, like currencies of other oil deficit Asian countries, remains under pressure. This is despite the fact that banks have been able to square off their end of the day daily position with ease.

On Saturday, two major banks - NBP and HBL - were buying dollars for their customers. With SBP staying on the side line and no inflows from abroad due to New York 4th of July closure the Pak rupee is now expected to come under fresh pressure on Tuesday, at least on the kerb, after New York opening.

On the interbank parity should weaken the rupee to Rs 70.65 to a dollar (by 50 paisas) more than the inter - bank parity of Saturday. The forward cover premium for 12 months was Rs 7.75; reflecting the 11 percent interest differential between KIBOR and LIBOR. It may be mentioned have that Pakistan is importing POL worth $375,000 per day and most of this is funded from the forex interbank market while the residual balance is met through countrys forex reserves. Business Recorder, 2007

Bookmark with:

More from Business