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Pakistani rupee ends flat, steadied by IMF deal
Reuters - 1 hour 12 minutes ago
KARACHI, Nov 21 - The Pakistani rupee ended flat on Friday, steadied by expectations that the first tranche of a $7.6 billion loan will be released by the International Monetary Fund next week. The rupee was quoted closing at 79.25/35 to the dollar compared with Thursday's close of 79.30/35.
The emergency loan should help the rupee stabilise, at least in the short-term, after a sharp depreciation this year as a balance of payments crisis developed, dealers said.
The rupee has lost 22.3 percent against the dollar this year.
Dealers said dollars from the kerb market were being sold in interbank following the suspension by central bank of the license of a prominent foreign exchange company earlier this month as part of an investigation into illegal transfers abroad. [ID:nSIN8796]
Pakistan's foreign exchange reserves fell $100 million to $6.64 billion in the week that ended on Nov. 15, the central bank said on Thursday.
The State Bank of Pakistan's own reserves fell to $3.46 billion from $3.50 billion a week earlier, just enough to cover nine weeks worth of imports.
Beset by its own problems, Pakistan has not suffered any direct impact from the worst global financial crisis in 80 years.
Neither the IMF agreement or the global financial crisis has had any impact on the stock market, which has been held in limbo by an artificial floor placed under the market at the end of August to protect an index that had already dropped nearly 35 percent since the start of the year.
Trading dried up weeks ago and on Friday the Karachi Stock Exchange benchmark 100-share index <.KSE> ended marginally up by 0.03 percent at 9,187.10 points, just 43 points above its floor. Only 100 shares were traded.
Dealers anticipate a sharp drop once the floor is removed and stocks were trading at least 20 to 25 percent lower in off-market transactions.
Exchange authorities have not said when the floor will be removed but dealers said it was unlikely to be removed before next month.
In the money market, short-term money ended at 4 percent, compared with Thursday's closing of 2 percent after the central bank mopped up 23.7 billion rupees of Treasury bills under one-day repo contracts at 6.40 percent.
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