April 29, 2002	Monday	Safar 15, 1423

THE rupee dollar parity ruled mixed last week in the absence of market moving factors. Amid dull activity on April 22, the rupee posted 2 paisa gain in the inter-bank market and traded at Rs60 and Rs60.02 against the dollar on the first day compared to the previous weekend close of Rs60.02 and Rs60.04.

It continued to show strength over the dollar on April 23, and breached the key level of Rs60. While importers kept themselves away from the market, exporters entered the market to sell dollar speculating further fall in dollar value. Excess dollar supply over demand helped the rupee recover marginally gaining another 2 paisa to trade at Rs59.98 and Rs60.

The recovery on April 23 proved short lived as heavy buying of dollar by some banks pushed the rupee lower by 6 paisa on April 24, amid lacklustre conditions in the forex market. Some small investors also went into sidelines, helping the dollar to gain slight strength over the rupee which traded at Rs60.04 and Rs60.05. Falling trend in rupee continued on April 25. The rupee lost 3 paisa over the overnight level and traded at Rs60.07 and Rs60.08 against the dollar. On April 26, the rupee remained in tight range. Few banks entered the market to buy dollar to meet their immediate requirements. The rupee was down marginally by one paisa trading at Rs60.08 and Rs60.10 versus the dollar

Against other major currencies at the inter-bank forex counter, the rupee during the week displayed strength versus the Chinese yuan, Malaysian ringgit, Saudi and Qatari riyals and the UAE dirham. It was stable against Hong kong dollar but continued to weakened against the British pound, euro, Canadian, Australian, New Zealand and Singapore dollars, Swiss franc, Japanese yen, Danish and Norwegian krones, Swedish krona and Kuwaiti diner.

In kerb trading, the rupee moved both ways in narrow range. After opening the week on a positive note on April 22, when the rupee gained 10 paisa over the previous weekend close of Rs60.30 and Rs60.40, it recovered 5 paisa more on April 23, trading at Rs60.15 and Rs60.25 making a cumulative gain of 15 paisa in two days. The rupee dipped 5 paisa in the kerb on April 24, after investors went into sidelines amid lacklustre activity to trade at Rs60.20 and Rs60.30. this trend persisted on April 25, in the absence of market moving factors as a moderate increase in dollar demand pushed the rupee down further by 5 paisa to trade at Rs60.25 and Rs60.35 against the dollar. It remained unchanged on April 26, with demand and supply almost in balance and major investors in the sidelines.

The parity is likely to move both ways in coming days, with the rupee showing strength over the dollar in the inter-bank as well as kerb trading. Some currency analysts, however, speculate the rupee to shed few paisas versus the dollar due to expected increase in dollar demand towards the close of fiscal 2002. On April over April basis, the rupee in the past twelve months has appreciated by Rs1.09 in the inter-bank market and by Rs3.55 in the kerb, reducing the gap between the two market rates by 92 per c