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Rupee steady vs dollar

June 25, 2012

IN the local currency market, the rupee this week was seen in recovery phase. Technical correction and low demand for dollar in the absence of major payments, amid quiet trading, helped the rupee rebound sharply against dollar.

The rupee this week regained partial strength over dollar, rising as high as Rs93.75/93.80 in the interbank market and Rs94.50/95.0 in the open market.

In the interbank dealings, the week commenced on a positive note as the rupee continued its weekend firmness, resisting further decline against dollar.

It traded at Rs94.00 and Rs94.05 in the first trading session on June 18, up 35 paisa on the buying counter and 32 paisa on the selling counter over the previous weekend’s levels of Rs94.35 and Rs94.37.

The rupee further gained against dollar in the second trading session, picking up 25 paisa and hitting the week’s highest levels at Rs93.75 and Rs93.80.

The rupee, however, lost firm ground amid rising dollar demand in the third trading session and was changing hands versus dollar at Rs94.25 and Rs94.27 after losing 50 paisa on the buying counter and also shedding 53 paisa on the selling counter on June 20.

The rupee extended its overnight weakness in the fourth trading session as it drifted lower, slipping by five paisa and traded at Rs94.30 and Rs94.32 on June 21.The rupee downslide versus dollar persisted in the last trading session. The rupee shed five paisa on the buying counter and six paisa on the selling counter, ending the week at Rs94.35 and Rs94.38 against the dollar. In the interbank dealings, the rupee on week over week basis, however, traded almost unchanged against the dollar.

Mixed sentiments were witnessed in the open market this week.

The rupee was seen in recovery stage. After hitting historic lows against dollar at over Rs96 last week, it resisted further decline this week and did not allow the dollar to breach Rs97 barrier. The rupee commenced the week on a positive note.

It traded against the dollar at Rs95.40 and Rs95.90 after picking up 60 paisa on the buying counter and another 40 paisa on the selling counter in the first trading session. Last week, the dollar had closed at Rs96.00 and Rs96.30 and many currency dealers were expecting it to climb to Rs97 this week.

In the second trading session, the rupee further gained 90 paisa and traded at Rs94.50 and Rs95.00, the week’s highest levels against the dollar.

But in the following two trading sessions the rupee lost ground versus dollar and assumed downward trend against the dollar. It drifted lower in the third trading session, slipping by 60 paisa on the buying counter and shedding another 50 paisa on the selling counter before closing at Rs95.10 and Rs95.50.

In the fourth trading session, the dollar climbed further to Rs95.40 and Rs95.80 after the rupee posted fresh loss to the tune of 30 paisa over the preceding day. Persistent dollar demand pushed the dollar further in the last trading session.

The rupee shed 40 paisa on the buying counter and 20 paisa on the selling counter before closing the week at Rs95.80 and Rs96.00. On week over week basis, the dollar in the open market, however, lost 20 paisa this week.

Versus the European single common currency, the rupee this week remained fluctuated in narrow band. It moved both ways, trading between the high of Rs118.80 on the buying counter and low of Rs121.20 on the selling counter after commencing the week on positive note. It picked up 50 paisa in the first trading session, changing hands against euro at Rs119.50 and Rs120.50 as against previous weekend’s Rs120.00 and Rs121.00. The rupee further extended its overnight firmness as it posted 70 paisa gain in the second trading session to trade versus euro at Rs118.80 and Rs119.80, its highest level during the week.

In the third trading session, however, the rupee failed to hold its past two days’ firmness versus euro and hit the week’s lowest level at Rs120.20 and Rs121.20 after shedding 70 paisa over the previous day close. But in the fourth trading session, it gave up its overnight losses and recovered 70 paisa to trade at Rs119.50 and Rs120.50.

The rupee closed the week on a negative note, trading against euro at Rs119.80 and Rs120.80 after shedding 30 paisa in the fifth trading session. During the week in review, the rupee on net basis recovered 20 paisa against euro.

On the international front, the euro fell from a one-month high against the dollar in New York first trading session, down 0.5 percent at $1.2576, off a one-month high of $1.2747 hit in Asia. The dollar rose 0.5 percent to 79.09 yen. In London, the pound slipped against the dollar, down 0.3 percent at $1.5660, retreating from a two-week high hit on June 15. Offers were cited at around $1.5730.

On June 19, the euro rallied against the US dollar, rising 0.9 per cent to $1.2683 after hitting a session high of $1.2730, partly helped by demand in the Middle East. Support is seen around $1.2536, the trend line drawn below daily lows from June 1.

Against the yen, the dollar slipped 0.2 percent to 78.93 yen. Sterling hit a session low of $1.5615 from about $1.5643, but trimmed its losses, and was last trading up 0.2 per cent at $1.5695 in London trade.

On June 20, the dollar edged lower against the euro in volatile trade and last traded at $1.2700, up 0.1 percent on the day, having hit a session low of $1.2636 on Reuters data. Sterling hit a one-month high against a softer dollar in London. It was up 0.1 percent to $1.5735, having risen to $1.5778-its highest level since May 22-and well above a session low of $1.5651 struck soon after the release of Bank of England minutes with some Asian central bank buying.

On June 21, the euro came under fresh pressure and posted its largest daily loss against the dollar in more than three months, dropping as low as $1.2529, far off previous day’s high of $1.2743. It was last at $1.2541, down 1.3 per cent, its worst day since mid-December. Against the yen, the dollar rose as high as 80.33 yen, its highest since mid-May. It was last at 80.32, up one percent. Sterling fell 0.3 percent to $1.5665, near a session low of $1.5655, and well beneath a one-month peak of $1.5778 hit a day earlier.

At the close of the week on June 22, the euro was flat versus the dollar. It hit the session’s peaks of $1.2583 and was last at $1.2543, little changed on the day, after falling to its lowest levels in about a week on June 21. The dollar was also up against the yen, rising 0.3 per cent to 80.52 yen. Sterling steadied against the safe-haven dollar, paring some of the previous day’s losses. It fell 0.1 per cent to $1.5573, with technical support seen around $1.5524.