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KARACHI, Oct 10: The rupee has gained 27 paisa or about half a percentage point against the US dollar in the inter-bank market so far this week.
Senior bankers said the rupee closed around 57.46 to a dollar on Friday up from the weekend close of 57.73.
They said the rupee has been on the rise on the back of higher inflow of export dollars meaning that the exporters have started selling their export proceeds on time. They said that the demand for the greenback has not been as high as it was in last month.
Senior bankers say the State Bank has allowed the dollar to shed some extra weight after keeping it stable through timely interventions. Since the start of this fiscal year in July the dollar has recorded a fall of 39 paisa or a three quarter of a percentage point against the rupee. At end-June it was trading around 57.85 in the inter-bank market.
Bankers say it is difficult to project at what level the SBP would restart defending the dollar for the benefit of exporters but many of them agree that 57.40 seems to be the new support level. A source close to State Bank also said the central bank might defend the dollar at this level.
KERB MARKET: In line with the falling trend seen in the inter- bank market the US dollar has become cheaper also in the open currency market. The US unit has so far shed 35 paisa against the rupee. It closed at Rs57.60/Rs57.70 for spot buying and selling on Friday down substantially from the weekend close of Rs57.95/ Rs58.05.
With the fall of the dollar both in the inter-bank and open currency markets the spread between the two exchange rates has also narrowed. On Friday the gap between the mid points of the official and open market exchange rates stood at 19 paisa — down substantially from the weekend spread of 27 paisa.
State Bank officials say the falling spread between the inter- bank and open market exchange rates would help banks attract higher inflows of home remittances or the money sent back home by overseas Pakistanis.
In first two months of this fiscal year home remittances from the US and the UAE fell substantially primarily due to a sharp increase in dollar value in open currency market.
