Rupee hits record low at 88.73 to Dollar

KARACHI: The rupee's slide continued for a third day on Wednesday, with increased import payments, negative sentiment about regional currencies and a bleak outlook for the country's economy driving it to a record low of 88.73 to the dollar.

"There was an oil payment of about $50 million which hasadded to the pressure on the rupee," said a currency dealer.

The rupee was trading at 88.65/73 to the dollar at 1:38 p.m. (0838 GMT), compared with Tuesday's close of88.25/30.

According to a poll conducted by Reuters last week, investors grew more bearish on most emerging Asian currencies in the last two weeks, as Europe's debt crisis deepened.

Pakistan's foreign exchange reserves fell to $16.96 billion in the week ending Nov. 18, after hitting a record $18.31billion in the week ending July 30.

The rupee has lost 3.52 percent this year.

There were also concerns about relations between Pakistan and the United States after a cross-border attack by NATO that killed 24 of the country's soldiers at the weekend.

"If the relationship does deteriorate further, look for increased selling from foreign portfolio investors ... with the currency also likely to accelerate its recent slide towards a parity of 90 rupees to the dollar," said Khalid Iqbal Siddiqui, director at Invest & Finance Securities Ltd. (Reuters)