Mixed sentiments were observed in the local currency market last week, as market players remained confused regarding the future outlook of the rupee.
On the interbank market last week, the rupee continued to show rising trend against the dollar amid fluctuations. Opening the week on a positive note, the rupee extended weekend gains against the dollar on Monday, changing hands at Rs124.25 and Rs124.75 against the prior weekend levels of Rs127.80 and Rs127.90.
The rupee continued stronger against the dollar on Tuesday changing hands at Rs124.00 and Rs124.25.
The rupee continued to rally against the dollar on Wednesday, with the dollar drifting down to Rs123.90 and Rs124.00. On Thursday the rupee turned negative against the dollar with dollar slipping to Rs124.05 and Rs124.10.
At the close of the week, the dollar was seen changing hands at Rs121.50 and Rs122.50 in the open market
On Friday, the rupee staged a modest recovery, restricting the dollar rise to Rs124.03 and Rs124.07.
In the open market, the rupee/dollar parity showed mixed trend last week. Commencing the week on a positive note, the rupee continued to recover losses against the dollar for the second straight week after hitting all-time low at Rs131 on July 21.
Extending weekend firmness, the dollar slipped to Rs118.00 and Rs123.00 on Monday against the prior weekend’s levels of Rs124.00 and Rs126.00.
On Tuesday, the rupee failed to hold firm ground; consequently the dollar was seen trading against the dollar at Rs121.50 and Rs122.50. The rupee turned negative on Wednesday slipping to Rs123 and Rs124.00 against the dollar. It, however, recovered on Thursday pushing the dollar slightly lower at Rs122.50 and Rs123.50.
The rupee managed to stage a recovery on Friday following reported inflows from China and offloading of dollar holdings by market participants. At the close of the week, the dollar was seen changing hands at Rs121.50 and Rs122.50.
Against euro, the rupee fluctuated sharply last week. Continuing on a firm note for the second consecutive week, the parity moved both ways, trading between the high of Rs129.50/141.00 and the low of Rs140.75/144.50 during the week.
Extending weekend firmness, the rupee on Monday was seen changing hands at Rs129.50 and Rs141.00 over the last closing at Rs132.80 and Rs147.00.
On Tuesday, however, the rupee failed to hold overnight firmness drifting lower to Rs131.00 and Rs141.00. The rupee downtrend against the euro persisted on Wednesday when the euro climbed further to Rs138.74 and Rs144.50.
On Thursday, the euro was seen changing hands at Rs140.75 and Rs143.50.
The rupee closed the week at Rs136.00 and Rs143.50.
Published in Dawn, The Business and Finance Weekly, August 6th, 2018