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Rupee inches down

Our Correspondent
Tuesday, Sep 14, 2021

KARACHI: The rupee edged lower against the dollar on Monday due to persistent demand for the greenback from importers, dealers said. In the interbank, the rupee closed at 168.10 per dollar, compared with the previous close of 168.02.

The rupee crossed 168 levels in the open market. It ended at 169 to the dollar, compared with 168.70 on Friday. Dealers said the local unit remained under pressure amid higher import payments and weak supplies.

“We expect the rupee to stay range-bound in the coming sessions as most market participants look to be cautious ahead of the central bank’s monetary policy decision and wait to see what the stance will take the State Bank of Pakistan on interest rates before taking positions,” said a currency dealer.

The SBP is likely to keep the policy rate unchanged at 7 percent in the upcoming policy review, but traders are concerned about the weakening of the local currency and rising inflationary pressures. If the SBP’s Monetary Policy Committee takes these two factors into consideration, it can raise the policy rate sooner rather than later.