In the local currency market, the rupee showed a steadier trend versus the dollar last week.

During the week, the SBP governor in a meeting with the Forex Association of Pakistan (FAP) expressed concerns over dollar volatility in the domestic market, where the rupee-dollar exchange rate increased to Rs108.60 in the open market and left the dollar trading nearly four rupees higher than the inter-bank rate despite sufficient dollar stocks to cater the domestic requirement of all type of foreign exchange needs.

Simultaneously, accepting the forex company’s demand to withdraw the condition of 10pc dollar surrendering into the interbank market for the next two months to enhance dollar supply in the open market, the SBP governor stressed that forex companies bring down dollar exchange rates from its current rate to Rs106.

As a result of SBP move, the situation improved in the open market towards the weekend.

Analysts are of the opinion that the dollar would trade between Rs107 and Rs108 in the first two quarter of 2017 but it is expected to hit Rs109 towards year-end.

In the open market, the rupee was seen recovering against the dollar

Meanwhile, the rupee traded in a narrow range on soft dollar demand from importers and corporate sector on the interbank market last week.

After commencing the week in minus amid sluggish demand, the rupee in the last trading session inched down by one-paisa and ended the week Rs104.85 and Rs104.85.

On week on week basis, the dollar on the interbank market gained one-paisa and ended the week little changed against the rupee.

In the open market, the rupee was seen recovering against the dollar last week.

Increased selling of the dollar by exporters and banks, a higher opening in domestic equity market and fresh foreign fund inflows, helped the rupee to recover against the dollar during the week.

However, the dollar’s recovery against some currencies overseas in international trade restricted rupee rise.

The rupee commenced the week on a stable note as it retained weekend level against the dollar.

The week ended on a positive note as the rupee gained ten-paisa on the buying counter while retaining its overnight rate unchanged on the selling counter in the last trading session with the dollar further slipping to Rs107.70 and Rs108.00.

Against euro, the rupee moved both ways, swinging between a low of Rs115.40/Rs116.90 and high of Rs114.00/Rs115.00 last week.

Commencing the week in plus, in the last trading session, however, the rupee shed ten-paisa and closed the week against the euro lower at Rs114.10 and Rs115.60.

On week on week basis, the euro lost 65paisa against the rupee last week.

Published in Dawn, Business & Finance weekly, January 23rd, 2017