KARACHI, May 20: Whereas the stocks crashed heavily on Monday on news of Indian aggression near Pakistan borders the rupee managed to hold firm — both in the inter-bank and open currency markets.

In the inter-bank market the rupee rather gained four paisa to close at Rs60.08/60.10 a US dollar for ready buying and selling against the weekend close of Rs60.12/60.14. Senior bankers said they had heard of the US dollar trading even below this level.

Bankers said initially the importers had showed some panic but as the day progressed the rupee strengthened on dollar selling by some banks that had enough to meet the market requirements. They said the central bank also kept a strict watch on the exchange rate movement and officials of the Exchange & Debt Management Department remained in touch with the market to help out those banks that had to buy dollars for their clients.

What makes the rise of the rupee in the inter-bank market more impressive is that this happened despite a $30 million outflow from the system. Bankers said banks made some $20 million oil import payment and made $10 million debt payment on behalf of a state-run power utility.

In the open market also the rupee closed unchanged at Rs60.40/ 60.50 a US dollar for spot buying and selling.

Money changers said initially there was some panic buying of dollars in the market and the rupee had come down to 60.60 per dollar but the local currency recovered part of lost ground as the State Bank warned them to stop speculating against the rupee.