KARACHI, Feb 7: The US dollar lost 41 paisa or 0.7 per cent of its value against the rupee in the inter-bank market during the first seven months of this fiscal year.

The US unit closed at Rs57.41 at end-January 2004 from Rs57.81 at end-June 2003. In the month of January alone the dollar rather gained two paisas rising from Rs57.39 as on December 31, 2003 to Rs57.41 on January 31, 2004. Bankers say it would have risen by a bigger margin had the State Bank not pre-arranged $1.17 billion from the market and from its own resources for repaying Asian Development Bank loans ahead of schedule.

Pakistan pre-paid $1.17 billion expensive ADB loans last month as part of its plan to reduce the cost of external debt taking advantage of rising inflows of foreign exchange into the country.

The SBP kept mopping up excessive inflows of foreign exchange from the inter-bank market thus maintaining stability in exchange rates primarily to benefit the exporters.

In the last fiscal year the dollar had shed 3.7 per cent of its value against the rupee. It would have fallen by a much bigger margin had the SBP not been mopping up surplus inflows of foreign exchange from the market. The central bank continues to follow the same policy.

OPEN MARKET: In the open market the US dollar lost 60 paisa or more than one per cent of its value against the rupee in seven months to January 2004. It fell from Rs57.95 at end-June 2003 to Rs57.35 at end-January 2004 for spot selling by money changers.

In the month of January 2004 the dollar remained unchanged at Rs57.30/Rs57.35 for spot buying and selling by money changers as the demand for the US unit remained static.