Dollar back to Rs100 on higher demand

KARACHI: The US dollar crossed the Rs100-benchmark in the open market towards the end of this week, after almost one and half months stability, said currency traders. The sudden jump in the greenback’s value came as rich Pakistanis are set to fly abroad with their families to enjoy summer vacations. “The dollar crossed Rs100 by mid of the day but returned back to Rs99.85 by the close,” said Anwar Jamal, a currency expert and money changer. The greenback remained below Rs100 for more than six weeks but it breached the limit on Thursday as it was traded at Rs100.20. It again traded above Rs100 on Saturday but slipped back to Rs100. “The dollar demand has increased substantially because of buying by individuals ahead of summer holidays,” said Jamal. Money changers said the buying trend is not new since hundreds of thousands of Pakistanis travel abroad in summer, either to enjoy the tour or to join their families living abroad. Many out of millions of Pakistanis living all around the globe also invite their families in their respective countries. However, other buyers were the people leaving for Umrah close to Ramazan and those preparing for Hajj. According to money changers, the balance of demand and supply has changed as the demand rose to 60 per cent while supply is not more than 40 per cent. They said buying pressure will continue. The inter-bank market did not reflect the change in the exchange rate but currency experts said the pressure was mounting in the open market, not in the inter-bank. Foreign exchange reserves of the country have increased to over $13bn, including $4.8bn of private banks. The fairly large size of the reserves has kept the exchange rate unchanged in the banking market. Published in Dawn, May 25th, 2014