THE local currency market wore a dull look this week in the absence of speculative trading. Despite heavy payments, sufficient supply pushed the rupee value up versus the dollar. On September 26, the rupee appreciated by eight paisa against the dollar trading at Rs59.75 and Rs59.77 in the inter-bank market. The rupee closed last week at Rs59.83 and Rs59.84.
On September 27, dollars’ demand by the banks was high due to month-end payments but inflows were strong which helped the rupee/dollar parity maintain its overnight levels. Inflow of remittances from the overseas Pakistanis ahead of the Ramazan is behind the rupees strength.
On September 28, the rupee extended its gains and recovered 14 paisa more versus the dollar. The dollar traded at Rs59.68 and Rs59.70 due to easy supply of the greenback. On September 29, the rupee showed just one paisa fall versus the dollar at Rs59.70 and Rs59.71, despite rising demand for dollar by the corporate sectors. Since the week started, the rupee is gaining due to high inflows of dollar by the overseas Pakistanis.
Balanced demand and supply of dollars on September 30, did not allow the rupee to move either side. The rupee firmly held its overnight levels at Rs59.70 and Rs59.71 for the second day in a row. During the week, the rupee, however managed to recover 13 paisa versus the dollar in the inter bank market.
In the open market, amid brisk demand of the greenback on September 26, the rupee shed 10 paisa for buying and another four paisa for selling, changing hands versus the dollar at Rs60.40 and Rs60.44. The rupee ended the previous week at Rs60.30 and Rs60.40 versus the dollar.
On September 27, the rupee recovered five paisa for buying to trade at Rs60.35 while it retained its overnight level for selling at Rs60.45. On September 28, inflows of dollar helped the rupee to sustain its firmness versus the US currency in the open market, picking up five paisa. It traded at Rs60.30 and Rs60.40.
On September 29, the rupee maintained firm position versus the US currency trading unchanged at Rs60.30 and Rs60.40. On September 30, the rupee suffered a slight fall due to month-end payments. The rupee showed downward revision in the open market, shedding 10 paisa against the dollar for buying at Rs60.40. It lost five paisa for selling at Rs60.45 over the previous week close.
The euro weakened against the rupee on the opening day of the week in review changing hands at Rs72.60 and Rs72.80 as it failed to come out of the recent weakness due to dollar’s continued firmness versus the other major currencies. The rupee was at Rs73.00 and Rs73.20 last week.
The rupee extended further gains versus the European single common currency on the second day of the week. It posted fresh rise of 15 paisa in relation to the euro at Rs72.45 and Rs72.65. The rupee, however, lost 15 paisa versus the euro on the third day of the week when it traded at Rs72.60 and Rs72.80. On the fourth day euro, the rupee traded unchanged at Rs72.60 and Rs72.80 on the fourth day.
Finally the rupee closed the week against the euro on a positive note, recovering 30 paisa for buying and 40 paisa for selling on the fifth day of the week trading at Rs72.30 and Rs72.40 as the dollar maintained its firm trend in the international markets. Over the previous week close, the rupee gained 80 paisa against the European common currency this week.
In the world markets, the dollar slipped from two-month highs against the euro to end lower on September 26, as currency investors turned increasingly cautious eyeing higher oil prices. Market talk of central bank buying of euros above the $1.2000 zone further boosted the euro. The US currency turned lower across the board.
In late New York trading, the euro rose to $1.2071, up 0.3 per cent from late week close. Against the yen, the dollar was trading down 0.3 per cent at 112.14 yen. Yet the dollar was still boxed in fairly tight ranges. Sterling hit a two-month low at $1.7705, but later rebounded to $1.7788, up 0.2 per cent. Against the Swiss franc, the dollar was trading at 1.2892 francs, down 0.3 per cent.
On September 27, the dollar rallied, hitting 2-month highs against the euro and yen, as traders focused on remarks from Federal
The reserve officials that point to more interest rate increases. Against the Japanese yen, the dollar was trading up about one per cent at 113.27 yen. It had climbed as high as 113.50 yen.
The euro was down about 0.5 percent from at $1.2013. It had gone as low as $1.1979. The euro had already slipped moderately even after a weak US consumer confidence report although investors were largely waiting for yen and Greenspan to speak. Against the Swiss franc, the dollar was up 0.5 per cent to 1.2957 francs. Sterling was down 0.7 per cent to $1.7667.
On September 28, the dollar weakened as investors considered the greenback’s recent rally to two-month highs had gone too far given the current outlook for US interest rates. The US currency also gave ground against the yen as Japanese stock prices and bond yields surged after a top Bank of Japan official suggested Japan was closer to ending seven years of deflation and raising its own key interest rate.
With the Federal Reserve seemingly committed to raising US interest rates through the end of the year, the dollar is finding solid support, meaning its downside has been limited. Still, future rate hikes may already be priced into the dollar, indicating some investors have overextended positions. The dollar made brief attempts early in the session to reach new highs against the euro and yen, selling pressure quickly pushed it back lower.
The euro was up 0.2 per cent at $1.2035, recovering from previous day’s two-month low of $1.1976. The euro had dipped as low as $1.1990 during the session but shot quickly back up to around $1.2055 before easing. The dollar was down 0.1 per cent against the yen at 113.10 yen. On September 27, it had traded as high as 113.50 yen. Sterling fell as far as $1.7619, its worst performance since late July and a quarter percent loss on the day.
On September 29, the dollar traded flat against the euro in the wake of a report that showed US weekly jobless claims fell more than expected. First-time claims for unemployment insurance fell to 356,000 in the week ended September 24, well below economists’ median forecast of 420,000. The euro rebounded as market participants took profits.
The euro slipped to session lows around $1.2007 after the report, before recovering to trade flat by late afternoon at $1.2041.The dollar was slightly lower against the yen at 112.98 yen. Sterling buckled as the dollar was boosted against the euro on an above-consensus US weekly jobs report. It hit a two-month low of $1.7593, but retraced slightly to $1.7617, down 0.36 per cent on the day.
THE local currency market wore a dull look this week in the absence of speculative trading. Despite heavy payments, sufficient supply pushed the rupee value up versus the dollar. On September 26, the rupee appreciated by eight paisa against the dollar trading at Rs59.75 and Rs59.77 in the inter-bank market. The rupee closed last week at Rs59.83 and Rs59.84.
