Rupee ends low, rate falls to 2% overnight

KARACHI: The rupee fell slightly on Monday in trading dulled by a holiday in the US.

The dollar closed at Rs 57.64 on the spot market, higher than Rs 57.62 on Friday but still under the Rs 57.70 level it dropped below for the first time in 32 months last Thursday.

Meanwhile, liquidity in the money market improved as banks started lending ahead of an auction of six-month Treasury bills on Wednesday. The overnight rate slipped to 1.5 percent-2 percent from 5.5 percent previously.

The State Bank of Pakistan plans to sell a lower-than-expected Rs 22 billion worth of six-month T-bills to be settled Thursday when an inflow of Rs 25 billion from maturing T-bills is expected.

“The lower target shows that the State Bank wants to keep the market liquid and doesn’t want rates to rise too much,” said a dealer at a commercial bank. The yield on the 10-year government bond traded at a relatively unchanged 5.05 percent. —Dow Jones Newswires

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