The rupee continued to display strength over the US dollar in the local currency market during the week under review.

The increase in dollar buying in the inter-bank market on the opening day of the week, pushed the rupee down by three paisa at Rs57.78 and Rs57.80 for buying and selling, respectively, on April 7.

On April 8, the rupee shrugged off its overnight weakness as dollar selling pressure by the major local banks boosted the rupee’s value recovering four paisa against the dollar to trade at Rs57.75 and Rs57.77. The rupee maintained its winning streak versus the dollar for the second day on April 9, gaining 3 paisa on buying and selling counter to trade at Rs57.72 and Rs57.74, respectively. The Pakistani rupee made quick recovery versus the greenback as the sellers overwhelmed the buyers.

On April 10, the rupee traded at Rs57.74 and Rs57.75 against the dollar, little changed from the overnight close of Rs57.73 and Rs57.74 for buying and selling. There were some scattered demands for the dollar, but the inflows were also coming in. On April 11 the rupee edged up slightly versus the dollar. It traded at Rs57.71 and Rs57.73, amid lack of buying interest in dollar. At the close of the week, the rupee was higher by 4 paisa compared to previous weekend close of Rs57.75 and Rs57.76. The rupee has appreciated 11.3 per cent against the dollar since September 2001, when it had touched as low as Rs64.25 against the dollar.

Rising trend was also seen in the kerb market on April 7. The rupee gained five paisa in relation to the dollar for buying and selling to trade at Rs57.80 and Rs57.90 in modest trading on the opening day of the week. On April 8, the rupee did not show major change in relation to the dollar for buying and selling and traded at Rs57.85 and Rs57.90. The rupee did not show major variation in relation to the dollar for buying and selling at Rs57.86 and Rs57.90 on April 9. On April 10, the rupee remained unchanged and the dollar traded at Rs57.85 and Rs57.90, respectively, for buying and selling. On April 11, the rupee shed 5 paisa and traded at Rs57.90 and Rs57.95 for buying and selling against the dollar of amid slight increase in dollar demand.

Against the Euro, the rupee managed to recover about Re1 trading at Rs60.85 and Rs61.15, respectively, for buying and selling on falling demand in the world market on April 7. The domestic currency, however, failed to sustain its overnight firmness versus the euro on April 8, losing 75 paisa for buying and selling at Rs61.60 an on April 9 Rs61.90. The rupee again failed to recover lost ground versus the euro on April 9, losing 35 paisa for buying and selling at Rs61.95 and Rs62.25, respectively. It shed further five paisa in relation to the euro on the buying and selling counters at Rs62.00 and Rs62.30 on April 10. The rupee managed to recover at Rs61.90 and Rs62.20 for buying and selling. The rupee, was also up by 10 paisa over the previous weekend level of Rs61.80 and Rs62.10.

Against other major currencies, the rupee at the inter-bank forex counter lost ground versus the British pound, Canadian, Australian and Singapore dollar, Danish krone, Swedish krona and Kuwaiti dinar. However it extended further gains displaying strength over Swiss franc, Japanese yen, Norwegian krone, Hong King and Singapore dollars, Malaysian ringgit, Chinese yuan, Saudi and Qatari riyals and the UAE dirham.

In the international financial market the US currency leapt across the board on April 7, after the US tanks stormed into the heart of the Iraqi capital.

The dollar rose as high as $1.0560 per euro overnight and rallied to 1.4080 Swiss francs, a three-month high, before paring gains in US trading. By late afternoon in New York, the dollar was up about a third of a per cent versus the euro at $1.0692 and 0.17 per cent against the Swiss franc at 1.3880. Against the yen, the dollar gave up its early gains to trade at 119.73 yen down 0.19 per cent. Against the euro, sterling gained 0.6 per cent on the day as the single currency, which has risen sharply recently on investor worries about the US-led war on Iraq. It shed 0.7 per cent on the dollar from last weekend close, trading at $1.5498 after hitting lows of $1.5482. It was up 0.68 per cent on the euro at 68.32 pence. Meanwhile, the euro lost more than a per cent on the day against the dollar, trading at $1.0591.

The dollar edged lower on April 8, they as dealers started to look beyond immediate successes for US-led forces in Iraq and to concentrate on what might come after the war is over.

In New York, the dollar was off about two tenths of a per cent against the euro at 1.0710 per euro and down 0.6 per cent versus the Swiss franc at 1.3868 francs. The dollar rose modestly against the yen, finishing in New York up 0.11 per cent at 119.82 yen. Sterling traded at $1.5496 against the dollar, down a quarter per cent on the day but still above the four-month low of $1.5458 hit early on April 7, when the dollar was rallying sharply as US forces were storming deeply into the heart of Baghdad. Against the euro, sterling was unchanged at 68.81 pence.

On April 9, the dollar was down about half a per cent against the euro at $1.0766 per euro close to the day’s lows of $1.0782 and well off session peaks of $1.0676 touched in the US shortly after the statue of Saddam came tumbling down. Against the Swiss franc, the dollar also lost about a half per cent to change hands at 1.3802 francs. The dollar fared better against the yen, rising 0.23 per cent to 120.11 yen.

Sterling finished the US trading day up 0.59 per cent at $1.5631. It finished flat against the euro at 68.85 pence per euro having earlier fallen to a four-year low at 69.39 pence. It fought back from a four-year low against the euro and held firm against the dollar on April 9. The pound was steady at $1.5555, a cent above four-month low of April 7, as the dollar also received support from images suggesting the war was in its closing stage.

The dollar pared its losses on April 10 afternoon.

In New York, the dollar was down marginally against the euro at $1.0779 per euro off the day’s highs of $1.0759 touched shortly after the release of the trade and claims figures but also well off the day’s lows of $1.0830 hit overnight. Against the yen, the dollar fell about a third of a per cent to 119.63 yen. The dollar rose 0.62 per cent against the Swiss franc to 1.3879 francs after that currency came under sharp pressure following a report from a Swiss think tank that forecast zero growth for the country’s economy this year and only 0.8 per cent growth in 2004.

Sterling rose 0.62 per cent against the dollar to $1.5724 getting a modest boost from the bank of England’s well-expected decision to keep interest rates steady. The British pound held a firm footing against the euro and the dollar on April 10 after the Bank of England left interest rates unchanged at 3.75 per cent, as largely anticipated. But with worst case scenarios avoided, sterling hovered near session highs at $1.5674 and 68.76 pence against the euro in late London trade, up a quarter per cent from the previous New York close.

At the close of the week on April 11, the dollar held steady in a market awaiting the release of data later in the day to gauge the health of the US economy, which is back in the spotlight following the fall of Baghdad. It stood at 119.77 yen up slightly from around 119.60 yen late on April 10 in New York. It traded in a tight 119.52-199.89 yen range in Tokyo. The euro was steady at $1.077 compared with late New York’s $1.0785, and was at 128.96 yen against 129.04.

Sterling slipped from its one-week peak against the dollar but bounced against the euro after surprisingly strong US retail sales and consumer data bolstered the greenback across the board. It had lost a third of a per cent to $1.5673 but remained in a recent range. Against the euro it gained half a per cent to 68.25 pence, coming off its four-year low set earlier this week.