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Firm trend in kerb, inter-bank rates last week

SEEMA SHAFI

KARACHI: The rupee last week showed slight weakness, shedding two paisa against the dollar in kerb at Rs 54.24 and Rs 54.28 while it maintained its almost one month stable trend in inter-bank market at Rs 51.90 for buying and selling, respectively.

Attributing the causes of the local currency keeping stable trend for several months, analysts expressed that there was a balance between the supply and demand of the greenback due to which no major fluctuation was reported neither in kerb nor in inter-bank rates on the one hand and on the other hand the bold decisions of the SBP during the two or three weeks about the forex transfer.

Commenting on the future direction of the rupee, experts were of the view that the rupee may get a shot in the arm its stability after the positive news from the IMF front. The government's economic team left for Washington on Thursday for further talks with the IMF on proposed Poverty Reduction and Growth Facility (PRGF). The officials circle is optimistic that its first tranche might subject to talks prove fruitful.

Even a cursory look into the meetings between the IMF mission and the government official would indicate that at this stage there was no clear directions and leave the interested quarters guessing.

However, a decision on the poverty Reduction and Growth Facility apparently appears unlikely in the immediate future.

The IMF team reiterated that the government needs to accelerate the process of economic reforms in the country, boost its revenues, exports and revive sick industrial units as quickly as possible.

The Fund has also not yet decided anything about the government request to convert the $1.5 billion ESAF/EFF into the proposed $2.5 billion (PRGF).

In the meantime the world leaders expressing disappointment at the outcome of the IMF and the World Bank lending, a contesting candidate for London Mayorship alleged that the IMF and the World Bank kill more oppressed people than Hitler had killed during all his life.

Now Cuban leader Fidel Castro at the G-77 summit in Havana also came out with a call to abolish the IMF and the World Bank and demanded Nuremberg-style trials for those who imposed economic order.

However, the IMF is defending itself by talking of economic progress in the world shortly.

KERB MARKET: On Monday, the rupee shed two paisa against the dollar at Rs 54.22 and Rs 54.26. On Tuesday, it did not show any change for buying at Rs 54.22, however, the local currency managed to gain one paisa for selling at Rs 54.25 in low business.

On Wednesday, it shed again one paisa for buying and selling at Rs 54.23 and Rs 54.26. On Thursday, it recovered one paisa for buying and selling at Rs 54.22 and Rs 54.25. On Friday, last trading session of the week due to Muharram holiday, shed two paisa for buying at Rs 54.24 and three paisa for selling at Rs 54.28 amid increasing demand for the greenback.

INTER-BANK MARKET: The rupee after maintaining its firm trend for several weeks, showed one paisa gain for buying at Rs 51.89 while no change was witnessed in its selling rate at Rs 51.90 in sluggish trading.