June 04, 2007	Monday	Jamadi-ul-Awwal 18, 1428

This week, the rupee managed to display strength versus the dollar in the inter bank market, while breaching the barrier of Rs61 against the dollar in the open market following higher demand by the importers for clearance of bills as the fiscal year 2006-07 near to close on June 30, 2007. Against the European single common currency the rupee, however, remained fluctuated throughout the week in review. The rupee posted one paisa gain against the dollar in the inter bank market on the opening day of the week, trading at Rs60.72 and Rs60.74 on May 28, after having closed last week at Rs60.73 and Rs60.75.

On May 29, the rupee remained stable against the dollar, changing hands at its overnight rates Rs60.72 and Rs60.73. On May 30, firmness prevailed as the rupee managed to gain versus dollar two paisa on buying counter and one paisa on selling counter despite the rising demand for the US currency. It traded to trade at Rs60.70 and Rs60.72. On May 31, the rupee failed to hold its overnight firmness against dollar and shed two paisa, changing hands versus the dollar at Rs60.72 and Rs60.74, as importers' dollar buying pushed the rupee down versus the US currency.

The rupee stood firm at its overnight level against dollar on the following day, despite strong demand for the US currency. It did not show major change and traded at Rs60.72 and Rs60.73 against the dollar on June 1. During the week in review, the rupee in the inter bank market remained firm against the dollar. It gained one paisa over the previous week. However, during the month, the rupee shed seven paisa. It was at Rs60.65 and Rs60.66, last month.

In the open market, the rupee extended its weekend slide against dollar on the week's opening day, shedding five paisa to trade at Rs.60.95 and Rs.61.05, against previous weekend's Rs60.90 and Rs61.00. The rupee was under pressure as the dollar demand increased by the corporate sector on May 28. Bearish sentiment prevailed in the open market on May 29. Higher demand for dollars pushed the rupee value down and the rupee shed three paisa for buying and one paisa for selling, trading at Rs60.98 and Rs61.06 against the dollar.

On May 30, the rupee, however, gained against dollar three paisa on buying counter and one paisa on selling counter, changing hands at Rs60.95 and Rs61.95 on easy supply of dollars. On May 31, the rupee managed to recover its overnight loss against dollar, picking up five paisa for buying and six paisa for selling to trade at Rs60.90 and Rs60.99 on the fourth day of trading.

The rupee maintained its overnight firmness against dollar in the open market on the fifth day of the week in review. It picked up two paisa for buying and four paisa for selling to trade at Rs60.88 and Rs60.95 on June 1. This week, the rupee in the open market gained two paisa on buying counter and five paisa on selling counter. Over the previous month close the rupee lost 23 paisa for buying and 20 paisa on selling against the dollar. Last month the rupee was at Rs60.65 and Rs60.75

Versus the European single common currency, the rupee lost 21 paisa on the first day of trading and changed hands at Rs81.75 and Rs81.88 as the greenback recovered its lost value against major currencies on May 28. The rupee, however, managed to recover four paisa against euro on the second trading day. It traded at Rs81.71 and Rs81.81, as the dollar retained its firmness against the leading currencies on May 29.

On May 30, the rupee again shed five paisa against euro and traded at Rs81.76 and Rs81.86. On May 31, the rupee further gained 11 paisa and traded at Rs81.65 and Rs81.75. It, however, failed to retain its firmness against the euro on June 1, and lost nine paisa, changing hands at Rs81.74 and Rs81.84 on the fifth trading day. During this week, the rupee lost 20 paisa on buying and 17 paisa on selling versus the European single common currency. Against the previous month close, the rupee this month recovered 19 paisa against the euro. It was at Rs82.55 and Rs82.65, a month ago.

On May 31, the dollar touched a three-month peak against the yen after a strong report on regional US business activity, but it failed to sustain gains. Against the yen, the dollar climbed as high as 121.99 yen, the highest since mid-February. It later gave up almost all its gains and traded at 121.72. The euro was up 0.2 percent at $1.3457, remaining within well-worn ranges for the last month.

Earlier in the trading session, the government revised down its estimate for first-quarter growth, showing the US economy grew at its slowest pace in more than four years. The dollar has clawed its way back from a record low hit against the euro in April and a 26-year low against the pound as worries about the US economy's health have eased, reducing speculation of lower interest rates that would erode the greenback's yield appeal.

Sterling held steady against the dollar. It was steady against the dollar, trading at $1.9802. Against the Canadian dollar, the greenback fell to a 29-1/2-year low at C$1.0666 on data showing that Canada's economic growth outpaced that of the United States in the first quarter. After three quarters of sub-trend growth, Canada's real gross domestic product growth bounced back to 3.7 per cent from the previous quarter.

At the close of the week on June 1, the dollar edged back near a three-month high against the yen as investors await a raft of US data including a monthly payrolls report later in the session. Traders said the dollar has a chance to extend its gains above 122 yen if the jobs data is healthy, but some analysts said the market may have already priced in a strong figure and any dollar-buying may not last long.