April 29, 2008	Tuesday	Rabi-us-Sani 22, 1429

KARACHI, April 28: The rupee ended lower on Monday, but remained under pressure from sustained high dollar demand, dealers said, adding that there was speculation that the central bank will increase interest rates soon.

The rupee closed at 64.40/44 to the dollar, down from 64.14/19 on Saturday, but stronger than its closing low of 64.66/70 on Friday.

“There were some dollar inflows on Monday, but the demand was pretty high, which kept the rupee under pressure,” said a dealer at a foreign bank.

Dealers said no central bank intervention was seen in the market on Monday, though there is speculation that the State Bank of Pakistan may increase its discount rate by 100-150 basis points from the current 10.5 per cent to curb imports and high dollar demand as well as to counter inflation.

The central bank is due to announce its bi-annual monetary policy in July, but it can make changes any time.

In the money market, overnight call rates ended at around 9.0 per cent, up from 7.0 per cent on Saturday.

Dealers said the market was expecting a central bank repo sale on Tuesday, when inflows of about Rs46 billion are due from maturing government securities.—Reuters