Dull trading activity prevailed in the local currency market last week and a depressed dollar enabled the rupee to stand firm.

On the interbank market, the rupee/dollar parity traded flat last week. The week commenced on a stable note as the rupee stayed flat against the dollar on Monday, retaining weekend rates unchanged at Rs115.61 and Rs115.62.

The parity remained range bound on Tuesday and Wednesday, consequently the rupee did not show any change and continued to trade at Rs115.61 and Rs115.62.

Trading on Thursday was suspended as banks were closed for business and public dealings on account of zakat deduction on first of Ramazan.

In the open market, the parity traded almost flat closing the week at Rs117.00 and Rs117.50

After trading flat in the first three trading session, the dollar closed the week slightly lower at Rs115.58 and Rs115.60 against the rupee on the back of soft dollar demand.

During the week in review, the dollar on the interbank market lost up to three-paisa against the rupee on week on week basis after trading flat at Rs115.61 and Rs115.62 for almost five weeks.

In the open market, the parity traded almost flat in the first three trading sessions at Rs117.30 and Rs117.80.

On Thursday, however, the dollar further dipped to a two-week low at Rs117.20 and Rs117.70 after the rupee posted ten-paisa gain.

The rupee extended further gains on Friday closing the week at Rs117.00 and Rs117.50.

Lack of interest shown by the market participants and less-than-normal demand from private sector in the last trading session kept the rupee firm against the dollar.

Against euro, the rupee traded firm, hovering in narrow band between the low of Rs140.20/Rs141.70 and high of Rs137.60/Rs139.10.

It, however, commenced the week on a negative note, changing hands against the rupee at Rs140.20 and Rs141.70 against the last closing at Rs139.75 and Rs141.25 on Monday.

On Tuesday, the euro gave up its overnight gains against the rupee and drifted lower to trade at Rs139.25 and Rs140.75, posting 95paisa loss against the rupee.

The euro downtrend persisted against the dollar on Wednesday as it was dragged further down at Rs137.75 and Rs139.25.

On Thursday, the rupee further strengthened against the euro. The rupee managed to post gains that pushed euro near a three-month low at Rs137.60 and Rs139.10 and on Friday the euro was seen changing hands at Rs137.50 and Rs139.00.

On week on week basis, the rupee last week managed to gain Rs2.25 against the euro.

Published in Dawn, The Business and Finance Weekly, May 21st, 2018