The local currency market continued to witness dull trading activity amid sluggish dollar demand.

The State Bank of Pakistan has reportedly tightened some rules regarding foreign exchange management to check dollar outflow and stabilise the rupee. At the same time, the rupee has also gained strength from the weak dollar in the overseas trade.

The dollar index has hit its lowest level against its major rivals in the year-to-date, losing 0.9pc on the week. On the other hand the euro has shown significant strength over the dollar.

Against euro, the rupee traded both ways amid sharp variation last week

During the week, it rose to its highest level since January 2015 and was up 1.3pc on the week.

On the interbank market, the rupee traded mostly range-bound against the dollar amid minor variations last week.

Commencing the week on flat note, the rupee traded unchanged at its weekend level of Rs105.39 and Rs105.40.

The parity traded little changed on Tuesday when the dollar pushed the rupee to the week’s lowest level at Rs105.40 and Rs105.41.

The rupee traded firm against the dollar on Wednesday at Rs105.40 and Rs105.41 for the second consecutive day.

On Thursday the rupee staged a minor rebound and pushed the dollar to almost a month low at Rs105.38 and Rs105.40, a level last seen on July 31.

The rupee/dollar parity ended the week flat. The rupee traded unchanged against the dollar at its overnight levels of Rs105.38 and Rs105.40.

During the week in review, the dollar in the interbank dealing lost one-paisa against the rupee on the buying counter.

In the open market, the rupee/dollar parity showed mixed sentiments amid dull trading last week.

Persistent low dollar demand on Monday helped the rupee with the dollar hitting fresh lows at Rs106.30 and Rs106.50.

The parity did not show any change in the following two sessions trading at Rs106.30 and Rs106.50.

The rupee, however, came under renewed pressure against the dollar on Thursday before slipping to Rs106.40 and Rs106.60.

The rupee further fell against the dollar closing the week at Rs106.60 and Rs106.80.

During the week in review, the dollar in the open market appreciated against the rupee by ten-paisa on week on week basis.

Against euro, the rupee traded both ways amid sharp variation last week.

Commencing the week on stable note, the rupee held its weekend levels against the euro at Rs124.00 and Rs125.00 on Monday and Tuesday.

The euro staged a rebound on Wednesday, pushing the rupee down to Rs124.25 and Rs125.25.

The rupee extended its overnight losses on Thursday shedding Rs1.35, its biggest single-day fall against the euro in almost five weeks; this dragged the euro to a three-week high at Rs125.60 and Rs126.60.

At the close of the week, the euro was seen changing hands at Rs125.00 and Rs126.00.

In August so far, the euro hovered between the high of Rs125.80/Rs126.80 and low of Rs124/Rs125 against the rupee amid variations.

Published in Dawn, The Business and Finance Weekly, August 28th, 2017