Rupee falls against dollar

KARACHI: The rupee fell against the dollar on Monday, as investors remained skeptical about resumption of the International Monetary Fund (IMF) bailout package, despite the government’s assurances that the programme was on track.

In the interbank market, the local unit declined by 0.85 percent or 2.44 rupees to 287.09 per dollar. The currency weakened by 1.50 rupees to finish at 293 per dollar in the open market.

“Pressure on the rupee is not surprising. Until the reserves improve or there is a clear indication of the IMF revival, the pressure would continue to mount on the rupee,” said Fahad Rauf, head of research at Ismail Iqbal Securities.

According to dealers, the local unit suffered from the rise in demand for dollars from importers after the central bank eliminated the cash margin requirement on imports. Although there were worries last week after the finance minister's trip to the US had been canceled that the IMF programme could once again be in jeopardy, the minister reassured through the press conference that the programme was on track, that the virtual meetings would be attended, and financial support from one last friendly country would soon be received.

“IMF programme is just one step away as after the financing commitment of $1 billion, all IMF recommendations will be fulfilled. Subsidised fuel programme is also dropped and it will no more be a point of concern,” said Chase Securities in a note.