Saturday, September 05, 2009

KARACHI: Persisting demand for dollars did not allow the rupee to shed its losses against the greenback on the currency market on Friday, dealers said. On the interbank market, the rupee shed five paisa against dollar for buying and selling at 82.90 and 82.95, they said. Market sources said that the weaker rupee is good to attract the buyers in the international market, in the meantime, they said that the rupee may trim its losses as a result of easy supply of the US currency.

During the final Asian session dollar held steady above this week's seven-week low against yen and kept a firmer tone against euro as investors hunkered down to await US non-farm payrolls later in the day. The market is uncertain how dollar will react to the August non-farm payrolls report due at 1230 GMT, after it lost its toehold above 93.00 yen at the start of this week and hit its lowest since mid-July just above 91.90 on Thursday.

OPEN MARKET RATES: The rupee retained its levels against dollar for the second day for buying and selling at 82.70 and 82.80, dealers said. Meanwhile the rupee gained 20 paisa in terms of euro for buying and selling at Rs 117.55 and Rs 118.05, they said.

Open Buying Rs 82.70 Open Selling Rs 82.80

Interbank Closing Rates: Interbank Closing Rates For Dollar On Friday.

Buying Rs 82.90 Selling Rs 82.95

(BRecorder)

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Saturday, September 05, 2009

ISLAMABAD: The World Bank believes that the absence of conditions from donors in the last few years has paved the way for Islamabad not to hike electricity tariff in accordance with the generation cost, leading to creation of the monster of circular debt that compromised country s ability to provide uninterrupted power to its consumers. When there were no conditions, the pricing formula to adjust electricity tariff simply disappeared, WB Senior Energy Specialist Rashid Aziz said while expressing his views in a panel discussion organised by the Pakistan Institute of Development Economics (PIDE) on the impact of circular debt at the Auditorium of Planning Commission on Friday. Member Planning Commission Shaukat Hameed pointed out that the tariff of power generation from Basha dam was proposed at 10 to 12 cents in the PC-1 so cheap electricity would not be available now. He criticised the IPPs, saying that the government guaranteed in 1996 to get electricity at 18 cents. It was also pointed out that the issue of circular debt could not be solved by injecting Rs200 billion through loans from the ADB or launching securitisation bond for overseas Pakistanis. Our banking system is not in position to arrange financing of Rs200 billion, so it requires tackling the issue, Federal Secretary Ministry of Textile Dr Waqar Masood said. Referring to an IMF document, he said the tariff is still short by 21 to 41 per cent in accordance with various estimates. The WB expert on energy, citing an example, said it is quite clear that when you go to market for purchasing a dozen eggs with a price of Rs50 but if you pay Rs30 it will not be possible to get a dozen eggs. But the same is not the case in the power sector. When asked to comment on increased level of electricity after installing of expensive Rental Power Plants (RPPs), he said that there was no gas available to fully utilise avenues of power generation.

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Saturday, September 05, 2009

LONDON: Oil prices fell on Friday after the world s biggest energy consumer the United States reported a rise in its unemployment rate and as traders booked profits before a long US holiday weekend. Ahead of the employment data crude futures had been rising steadily, recovering from falls suffered on Thursday. New York s main contract, light sweet crude for October delivery, dipped five cents to $67.91 a barrel after the US jobs report for August. Brent North Sea crude for October delivery was 23 cents lower at $66.89 a barrel in afternoon London trading. The US unemployment rate jumped to 9.7 per cent in August as 216,000 jobs were lost, the US government said on Friday in a report suggesting steadying labour market conditions. The jobless rate rose three-tenths of a point to the highest level since June 1983, but the data nonetheless showed an easing of the massive pace of job losses in an economy struggling to emerge from recession. Elsewhere, oil traders were gearing up for next week s OPEC ministerial meeting in Vienna to decide on the cartel s crude production levels. Angola, 2009 president of the Organisation of the Petroleum Exporting Countries, has said the cartel should maintain production at existing levels during the September 9 meeting. OPEC has influence over global oil prices because the cartel pumps about 40 per cent of the world s crude. In a mixed trading week, crude futures fell sharply from levels above $70 on Monday and extended losses before stabilising on Wednesday as official data showed US crude stocks had dropped by an expected 400,000 barrels.

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Saturday, September 05, 2009

KARACHI: The National Investment Trust (NIT), a leading mutual fund company being managed by the government, formally announced plans on Friday to diversify its product base from a single equity fund to a bond and income fund. According to NIT Chairman and MD Tariq Iqbal Khan, the Trust was going to introduce two new mutual funds, but these would not be belonging to the equity segment this time. One of these would be a bond category fund while the other would be an income fund, he said. The difference among above mentioned three categories of funds is that the received money from unit holders in the equity fund is invested in the stock market; the bond funds are invested in bond markets, while income funds are invested in some fixed-income schemes. All the three categories have different level of risk and reward as well. Talking to a group of reporters in his office, Khan said the Securities & Exchange Commission of Pakistan (SECP) has given go-ahead single to the Trust to launch its bond fund, the NIT Government Bond Fund (NIT-GBF). Today in the afternoon, we are going to register NIT-GBF with the registrar and its Initial Public Offering (IPO) is expected to take place sometime after Eid. We, therefore, are trying our best to bring its prospectus in the market before Eid, he explained. As far as the introduction of another fund in the income segment i.e. NIT Income Fund (NIT-IF) is concerned, work on this product is also under way simultaneously and approval for the fund has also been sought from the SECP, which is expected any moment, he said. Since NIT was subject to be sold into the private sector in the near past so that it was not striving to expand operations at that juncture of business.

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Saturday, September 05, 2009

KARACHI - State Bank of Pakistan on Friday announced a new financing facilities scheme for cotton ginners with a view to modernize their factories to produce quality ginned cotton for the textile value chain and to minimize electricity consumption. This scheme is only available for SME borrowers, as defined in Prudential Regulations for SMEs. This scheme has been effective from September 04, 2009 (Friday) and shall remain valid only up to December 31, 2010 on first come first served basis and subject to availability of funds under the Scheme. In a circular issued by central bank, it was stated that financing under the scheme would be available for a maximum period of seven years including a maximum grace period of six months. Financing facilities under the scheme shall be provided through all commercial banks and Development Finance Institutions (DFIs). According to SBP, financing shall be available only for Balancing, Modernization and Replacement (BMR) of Cotton Ginning Factories. SBP further said cotton seeds crushing machinery installed in the premises of ginning factories shall also be eligible to avail financing facilities under the scheme. Financing shall be available for purchase of only new locally manufactured plant, machinery & equipment. Financing for purchase of new generators up-to a maximum capacity of 500 KVA shall also be eligible. The capacity of generator shall, however, not be in excess of the ginning factory s in-house energy requirements or upto 500 KVA, whichever is less. As per details, SBP announced different mark-up rates for different periods for financing this scheme, for instance, for the tenure of 3 years, banks will charge 6 per cent rate of refinance, 2 per cent spread with 8 per cent end users rate while over 3 years and up-to 7 years period, this facility will be available on paying 6.50 per cent rate of refinance, 2.5 per cent bank spread and 9 per cent end user rate from the borrowers. Over 5 years and up-to 7 years rate of refinance will be 7 per cent, spread 3 per cent and 10 per cent end users rate respectively. It is important t note that financing rates shall be revised on annual basis effective from July each year and mark-up shall be paid on quarterly basis.

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Saturday, September 05, 2009

International gold prices may touch $1,200 an ounce by the end of December, 2009, a top trade official said on Friday. “Investment demands by gold exchange-traded funds and China buying more gold reserves will help achieve this target,” said Suresh Hundia, president of the Bombay Bullion Association on the sidelines of a conference.

Gold steadied below $990 an ounce on Friday, consolidating a potent two-day rally that took the market to within a whisker of $1,000, with inflation concerns and jitters over stock market gains stoking investor interest. Buying of gold exchange-traded funds picked up, with holdings of the largest, New York’s SPDR Gold Trust, posting its biggest one-day percentage rise since March. India is a major importer of gold.

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