Euro, pound decline sharply

Staff Report

KARACHI: The rupee gained strength against all major currencies in the interbank market on Thursday, said treasurers.

The pound sterling closed at Rs 111.02 for buying and Rs 111.12 for selling. It registered a decline of Rs 1.83 against the local unit.

The euro plunged 98 paisas in the interbank to close at Rs 77.26 for buying and Rs 77.36 for selling. The dollar declined five paisas to close at Rs 59.34 for buying and Rs 59.39 for selling.

“Since the dollar was gaining strength in the international markets against the pound sterling and the euro, these two currencies recorded large falls against the rupee,” said treasurer at a large local bank.

On the other hand, the US currency lost value against the rupee, because the country's foreign exchange reserves have risen.

The dollar hit a six-week high against the yen on Thursday, as traders worried about the risk of aggressive US rate hikes.

A surprisingly hefty rise in US consumer inflation gave traders reason to think that the Federal Reserve, which on Tuesday flagged inflation worries, may lift interest rates faster and further than expected. Data on Wednesday showed US consumer prices rising at the fastest year-on-year pace since 2002.

The greenback was also close to five-week highs against the euro, though the single currency was a touch firmer at $1.3014 after having fallen below $1.2960 on Wednesday. The euro has now shed more than six cents from record high scaled last December.

Kerb market: The rupee rose sharply against the pound sterling and the euro, but declined versus the dollar in the open currency market, said foreign exchange dealers. The US currency surged 13 paisas to close at Rs 59.83 for buying and Rs 59.87 for selling.

The pound sterling closed at Rs 112.20 for buying and Rs 112.30 for selling, falling Rs 1.35. It was trading at Rs 111.90 for buying and Rs 112.00 for selling in early trade.

The euro closed at Rs 77.90 for buying and Rs 78.00 for selling, decreasing Rs 1.10 paisas. It was trading at Rs 77.70 for buying and Rs 77.80 for selling initially.

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