http://dawn.com/2012/12/14/rupee-may-hit-100-mark-against-dollar/
KARACHI, Dec 13: The sudden increase in the demand for dollars and anxieties over falling foreign exchange reserves may drive the exchange rate at Rs100 level within days, said currency experts.
The dollar soared to new peaks against the rupee both in the inter-bank and open market on Thursday.
Dealers said high demand and low availability pushed up the price of the dollars in the currency market.
The exchange companies said hoarding started at individual level. The bankers, however, believed the currency dealers themselves were involved in hoarding of the currency they expected to gain value.
The minute to minute depreciation of the local currency encouraged many individuals including some currency dealers to bag profits by hoarding dollars, it was observed.
We traded dollar at Rs97.50 in the second session and believe that the greenback would get more addition in its value on Friday, said Atif Ahmed, a currency dealer in the inter-bank market.
Analysis shows that dollar appreciated by 3.3 per cent against the rupee during the current fiscal year. At the end of FY12 the dollar was traded at Rs94.40 which hit as high as Rs97.50 on Thursday.
The FY12 had witnessed a rupee depreciation of 9 per cent against the US currency. The weakening of local currency is still continuing.
We are buying dollar at Rs98 and selling at Rs98.20, said Anwar Jamal, a currency dealer in the open market. He said the individual hoarders appeared in the market as the market saw very low number of sellers while buyers were available in flocks.
However, a currency expert in a large bank said the money changers used to play key role in hoarding of dollars.
They may earn much more by hoarding dollars in an environment like this, he said. Money changers denied the allegation.
What is more discouraging for the inter-bank was the complete absence of the Central Bank which had been using influence to check the imbalances in exchange rate by injecting dollars.
The State Bank conduct supported the perception that Pakistan has agreed to devalue its currency to appease IMF that the government might approach to renegotiate another agreement or sign up for re-rolling of the current IMF loan.
The State Bank reported on Thursday a $126 million decline in the countrys foreign exchange reserves during a week.
The US has reportedly assured release of $600 million as coalition support fund while it also promised $200 million for construction of Bhasha Dam.
