Rupee strengthens

KARACHI: The rupee appreciated against the dollar on Thursday amid lacklustre activity in the currency market, dealers said.

The rupee gained nine paisas to close at 85.85 to a dollar in the inter-bank market from the previous day’s close of 85.97.

“Traders show reluctance to buy greenback on the hope that the foreign currency’s value may further go down,” a dealer said. The rupee is stable against the dollar during the ongoing month after it registered a decline to a historic low of 86.32 early this month on heavy demand for the dollar for import payments.
The inter-bank forex market started the day in the range of Rs85.93 and 85.97. The dollar witnessed deterioration throughout the day as it registered a high of Rs85.93 and a low of Rs85.85. Currency experts said that the dollar demand would rise early next month as import for oil payments is due. However, the inflows of home remittances and export receipts would help the rupee maintain its current levels, they added.

Weak rupee boosts exports, data proves the contrary

LAHORE: The myth that rupee depreciation boosts exports is not true as exports remained stagnant from 1994 to 1999 despite massive rupee depreciation, but rose appreciably when the rupee was stable from 2003 to 2008, analysis of trade data reveals.

The foreign trade data of past two decades collected by The News showed that devaluation of rupee almost always failed to boost exports that grew during the period when the rupee remained stable against the dollar.

Rupee further gains 21 paisas

KARACHI: The rupee further strengthened its position on Thursday to close at 83.50 against the dollar in the currency market.

According to the weighted average, customer exchange rates issued by the State Bank of Pakistan (SBP), the rupee gained 21 paisas against the greenback.

Govt to study inflationary impact of VAT: FBR chief

 ISLAMABAD: Government will conduct a study, worth Rs6.0 million, regarding the impact of Value-Added Tax (VAT) on inflation, Federal Board of Revenue (FBR) chairman said on Thursday.

“After the study we will have reliable data about its impact on inflation, revenue and further documentation of the economy,” FBR Chairman Sohail Ahmed told a news briefing convened to erase confusion on VAT.

Although the FBR chairman insisted that VAT would have no inflationary impact, one of his subordinates differed, saying that it would create a price-hike.

Weak rupee adds Rs17bn to debt servicing

ISLAMABAD: Servicing of both domestic and external debt to cost the national kitty Rs664 billion during the current fiscal year as against the budgetary estimation of Rs647 billion due to depreciation of the rupee, officials in the finance ministry told Dawn on Saturday.


The sources said that domestic debt servicing was estimated to be Rs573 billion at the start of the fiscal year, however, upward revised estimates suggested that it would be Rs589 billion owing to inflationary factors and increased short-term loaning by the government for budgetary support and operational expenses.

Differences over VAT jeopardises IMF plan

ISLAMABAD: The International Monetary Fund (IMF) and the government have developed differences over the proposed value added tax (VAT), raising fears not only of the fiscal deficit surging during the current and next year but also about the completion of a $11.3 billion standby arrangement programme.
According to sources, the IMF estimates that the VAT will increase the country’s revenue by 0.8 per cent of the GDP next year, but the finance ministry fears that the collection will drop by Rs35-45 billion because tax collection authorities are not fully prepared to take full benefit of the new measures.

Rupee gains over dollar amid falling imports

KARACHI: The dollar fell to Rs84 on Thursday reflecting the lower demand with falling imports and sufficient availability of the currency.

“The dollar was traded in the range of Rs83.95 to Rs83.98 in the inter-bank market on Thursday, which was the lowest of this calendar year 2010,” said Atif Ahmed, a currency dealer.

Rupee slide continues

Saturday, January 09, 2010
KARACHI: The Pakistani rupee fell to a new low on Friday for the fifth consecutive day because of high demand for dollars to pay for imports.

The rupee was quoted closing at 84.95/85.02 to the dollar compared with Thursday’s close of 84.79/85.

“The weakest trade for the rupee was made at 84.90,” said a currency dealer in Karachi.

Rupee falls to record 84.57 against dollar

KARACHI: The rupee fell to a record low against the dollar on Monday while it already lost almost Re1 since the private sector was given sole responsibility to pay the entire oil bills.
 
The dollar was traded at the maximum price of Rs84.57, which is the highest price dollar ever found in the local market, said currency traders adding that the dollar gained up to 20 paisa on Monday.

Import payment pressure pushes rupee down

Experts say SBP won’t intervene

Tuesday, January 05, 2010
By Saad Hasan

KARACHI: The rupee dropped to a new low of Rs84.65 on Monday, down 0.44 per cent from Saturday’s close of Rs84.25 as importers rushed to buy US dollar to make oil payments, dealers told The News.

The weighted average at which commercial banks bought and sold the dollar was Rs84.33 and Rs84.52 respectively, the State Bank of Pakistan (SBP) said. Average exchange rate on Saturday was Rs84.20 and Rs84.39.

Jul-Nov trade deficit down by 37.57pc due to weak rupee

Figures show exports at $7.61bn, imports at $13bn against $8.2bn and $16.99bn in the same period of last year

Sunday, December 13, 2009
By Israr Khan

ISLAMABAD: Helped by the weaker value of rupee, Pakistan’s trade deficit (an excess of imports over exports) during July-November 2009-10 narrowed by about two-fifth (or $3.29 billion) over the corresponding period of the last fiscal, official figures show.

Although, to some extent the weaker rupee is helping economy in reducing exports-imports gap, yet it is also instrumental for mounting pressures on the country’s external debt (i.e. each dollar debt needs more rupees to retire or service it).

Rupee depreciation

The latest speculative attack on the rupee was not unexpected following the State Bank’s announcement that it will shift the entire burden of arranging foreign currency for making crude-oil-import payments on the private sector from Dec 14. 
 
But the assumption that speculators will cause the rupee to fall sharply any time soon, just as they led it to cumulatively lose almost a quarter of its value in 2008, looks weak. The macro economy is stabilising and the IMF is expected to release the third stand-by-loan tranche of $1.2bn shortly. That should shore up the country’s import cover to seven months and reduce pressure on the rupee. We also know that the State Bank’s decision to transfer the burden of furnace-oil and diesel payments to the private sector in January and August brought the rupee under pressure. The exchange rate has depreciated but only gradually, by 0.5 per cent a month, since February because of higher inflation. Barring isolated speculative raids on the currency, the trend should continue during the rest of the fiscal year.