KARACHI, July 13: The State Bank had to ask some banks to sell dollars in the inter-bank market on Tuesday to prop up the rupee. The central bank made this indirect intervention to defend the rupee at 58.20 to a dollar.
Bankers said the rupee closed at 58.20 a dollar on Tuesday up from 58.28 on Monday as a couple of local and foreign banks sold several million dollars each on the verbal instructions of the SBP. No SBP official was available to confirm it.
With the eight paisa gain the rupee made on Tuesday the total fall in its value so far during this month came to eight paisa. At the end of June the local currency had closed at 58.12 per US dollar in the inter-bank market down 0.5 per cent from its end-June 2003 level of 57.81.
Bankers close to SBP say the gain the rupee made on Tuesday was amazing because it happened amidst huge foreign exchange outflows from the system. They gave varying estimates of the unusual outflows through lumpy payments by the government agencies and corporates.
