Buy rate for dollars in the interbank market today were Rs. 85.00 and sell rates were Rs.85.05. In both directions Pakistan rupee was standing strong.

During the Asian trade dollar fell to its lowest in more than two months against yen as investors dumped long positions against other currencies that had built up to levels not seen in more than a year.

Investors have been picking up dollars in recent months as Greece’s credit and fiscal woes hit the euro and worries over a potential hung parliament and speculation that Britain’s asset-buying scheme could be revived knocked the pound lower.

The rupee was higher by 20 paisa against the US currency for buying and selling at 85.20 and 85.40 in open market. The dollar touched a two month low against the yen in Asia on Wednesday due to selling by Japanese exporters, falling long-term U.S. interest rates, and expectations for weak U.S. jobs data.

During Asian trading hours, the dollar fell to Y88.47 on EBS, the lowest since Y88.32 on Dec. 14. That compares with Y88.75 in New York late Tuesday.

If coming U.S. data are weaker than expected, adding to speculation that the Federal Reserve may not start raising its policy rate as soon as had been expected, U.S. yields could fall further, causing the dollar to decline more against the yen, Inoue said. He tips the dollar to trade in a range of Y83.00 to Y91.00 in the coming days.

However, Pakistan rupee lost 50 paisas againts the euro: buying and selling at 114.85 and Rs 115.35. The euro had hit a two-week high Wednesday against the dollar in a sign that Greece’s stepped-up efforts to cut its gaping budget deficit has helped calm investors fears over a possible debt crisis.

But the reprieve for the common currency may not last: There is no assurance the Greek measures will be fully implemented nor was there any word from Germany or France, the euro zone heavyweights, whether they would offer more than just verbal support to the debt-laden Greeks.

Investors are now waiting to see whether “an actual bailout will happen,” said Jessica Hoversen, fixed-income and foreign-exchange analyst at MF Global in Chicago.

Pakistani Forex dealers say they expect the currency to remain under pressure.

The rupee PKR= was quoted closing at 84.86/96 to the dollar compared with Wednesdays close of 84.66/76. The weakest trade for the rupee Thursday was made at 85.07. That compared with the previous record low of 84.76 during trade on Wednesday.

Dealers said they expected the rupee to ease to more than 85 to the dollar in coming days.

Demand for dollars to pay for oil has increased since last month when the central bank ordered commercial banks to provide foreign currency for imports of crude oil, as part of Pakistan’s commitments under an International Monetary Fund (IMF) programme.

Previously, the central bank had provided dollars for crude oil imports.

Pakistan secured an IMF emergency loan package of $7.6 billion in November 2008 to help avert a balance of payments crisis and shore up reserves. The loan was increased to $11.3 billion in July last year.

The State Bank of Pakistan stopped providing foreign exchange for furnace oil imports in February 2008 and for diesel and other refined product imports in August last year.