The local currency market witnessed volatile trade last week where the rupee, quoted as Asia’s worst-performing currency this year by Bloomberg analysts, has come under tremendous pressure against the dollar after three devaluations since December last year.

In the latest move, the rupee was devalued by 4.8 per cent on the interbank market and 5.4pc in the open market in the second week of June. The central bank has so far refrained from intervening.

The rupee has tumbled to historic lows with the dollar hitting Rs121.52/55 on the interbank market and at Rs124.00/124.50 in the open market.

The rupee has tumbled to historic lows with the dollar hitting Rs121.52/55 on the interbank market

Last week, the rupee continued its slide against the dollar. On the interbank market, on Tuesday the rupee failed to resist further erosion and the dollar was seen changing hands at Rs121.70 and Rs121.80 against the prior weekend levels of Rs121.00 andRs121.50.

On Wednesday, the rupee turned positive against the dollar and the dollar drifted slightly lower at Rs121.45 and Rs121.50 towards the close of the session.

The market witnessed moderate changes in the rupee/dollar parity on Thursday, changing hands against the dollar at Rs121.48 and Rs121.52.

The rupee downtrend versus the dollar persisted on Friday enabling the dollar to hit all a time high of Rs121.52 and Rs121.55 towards the close of the week.

Market players witnessed another volatile week in the open market. The rupee commenced on a negative note as it tumbled to a fresh low at Rs122.60 and Rs123.60 on Tuesday.

On Wednesday, the rupee nose-dived to cross the Rs124.50 barrier closing the session at Rs124.00 and Rs124.50.

On Thursday the rupee traded unchanged against the dollar retaining its overnight rate at Rs124.00 and Rs124.50; while on Friday the rupee continued to trade flat, closing the week unchanged at Rs124.00 and Rs124.50 after the Exchange Companies Association of Pakistan (ECAP) decided to cap the dollar rate at the present level.

Against euro, the rupee depicted a firmer trend, trading in narrow range last week.

Commencing the week in plus, the rupee managed to stage a rebound on Tuesday pushing euro down to Rs140.00 and Rs142.00.

The rupee, however, failed to retain its overnight firmness on Wednesday when the rupee slightly lower at Rs141.75 and Rs143.25.

On Thursday, the euro slipped to Rs140.50 and Rs142.50, a level last seen on June 13.

The rupee continued its downslide versus the euro on Friday and edged sharply lower, hitting fresh low at Rs142.30 and Rs144.30.

Published in Dawn, The Business and Finance Weekly, June 25th, 2018