Rupee closes weaker against dollar

KARACHI: In the currency market today, the rupee ended weaker at 90.77/82 to the dollar, compared with Thursday's close of 90.62/70 because of increased import payments following a rise in global oil prices.

Oil prices were steady at around $125 per barrel on Monday, pausing after a rally of around 1.5 percent the previous session as renewed worries about the financial stability of the eurozone returned to the fore.

The rupee had been supported last week by remittances from Pakistanis overseas, which rose 23.4 percent to $8.59 billion in the first eight months of the 2011/12 fiscal year, compared with$6.96 billion in the same period last year.

In February, remittances totaled $1.16 billion.

The rupee touched a record low of 91.28 to the dollar in January, dragged down by concerns over higher payments for oil imports and Pakistan's overall economic health. There was also concern about Pakistan's current account deficit, which widened to $2.952 billion in the first eight months of the 2011/12 fiscal year, compared with $194 million over the same period in the previous year.

The current account deficit in February was $260 million, compared with a deficit of $98 million in February 2011. The deficit stood at $364 million in January 2012.

In the money market, overnight rates rose to 11.90 percent, compared with Thursday's close of 9.10 percent amid lack of liquidity in the interbank market despite the State Bank of Pakistan conducting a reverse repo in which it bought back government paper worth 223.05 billion rupees ($2.46 billion). (Reuters)