The local currency market witnessed a firmer trend in rupee versus the dollar and euro last week.
Activity remained dull in the market as traders stayed glued to the sidelines in the absence of fresh triggers after the dollar overseas traded near break-even levels, retreating from an early advance as investors continued to watch the political situation in Europe with caution.
The local currency traded almost range-bound due to sluggish market sentiments.
The SBP provided sufficient support to commercial banks to stabilise the local currency while commercial banks and leading currency players remained watchful on dollar inflows and outflows in the market. On the interbank market, the rupee showed a stable trend against the dollar last week.
The parity, however, commenced the week in negative as the rupee shed three-paisa on the buying counter and two-paisa on the selling counter that helped the dollar to climb to Rs104.81 and Rs104.82 in the first trading session.
The local currency traded almost range-bound due to sluggish market sentiments
However, the parity retreated to the previous weekend’s level, closing the week at Rs104.78 and Rs104.80.
During the week, the dollar in the open market suffered losses against the rupee to the tune of three-paisa on the buying counter and two-paisa on the selling counter in two sessions but it managed to recover on both the counters by the same amount in one session.
Thus the parity did not show any change on week on week basis.
In the open market, the rupee showed a steady trend versus the dollar due to lack of trading interest in the absence of leading currency players.
After trading flat at Rs107.70 and Rs107.90 for four straight sessions in the previous week, the rupee was seen holding firm ground against the dollar last week after commencing the opening session on a positive note.
In the last trading session, the parity continued unchanged at its overnight level for the second consecutive day with the dollar trading flat against the rupee at Rs107.20 and Rs107.40 at the close of the week.
During the week, the dollar hit almost a three-month low on in the open market after suffering a net loss of 50paisa against the rupee on week on week basis.
Extending previous weekend firmness against euro, the rupee continued to trade in positive territory last week.
In the first trading session, it posted 45paisa gain, changing hands against euro at Rs115.30 and Rs116.80 against the prior weekend level of Rs115.75 and Rs117.25.
Finally, the euro closed the week on a firm note. Retaining its overnight rate for the second day in a row, the rupee traded flatly against the euro at Rs114.20 and Rs115.70, hitting almost a four-week high in the last trading session.
During the week in review, the rupee managed to gain Rs1.55 against the euro on week on week basis.
Published in Dawn, Business & Finance weekly, February 13th, 2017