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KARACHI, Mar 16 (Reuters) The Pakistani rupee closed at a 16-month low on Thursday as importers bought the dollar to clear payments.

The rupee closed at 60.17/19 to the dollar, down from 60.13/15 a day earlier. The rupee last hit this level in November 2004.

Dealers said the local unit was likely to remain under pressure in the days ahead.

''There has been a very high demand for the dollar in recent days, which has pushed the rupee lower,'' said a dealer at a major local bank.

''Also, there have been large debt payments during this month, and there are some more scheduled in the coming days, which has added to the pressure on the rupee,'' he said.

The rupee held steady over the past few months, but started to lose value recently due to a yawning trade deficit.

High global oil prices and the cost of importing machinery needed for a fast growing economy pushed the trade deficit to a provisional $936 million in February from $916 billion in January, and $617 million in February 2005.

The cumulative trade deficit for the July-February period was $7.43 billion against $3.47 billion a year earlier.

Analysts say the deficit, and the resulting high current account deficit, was likely to weaken the rupee in the coming months.

In the money market, short-term rates rose after an outflow of over 32 billion rupees from the market for the settlement of a Treasury bill auction on Wednesday and the repo operations during the day.

Overnight call rates ended at around 7.5 per cent, up from 6.0 per cent a day earlier.

REUTERS SD DS1655