IN the local currency market, the rupee this week hit all-time low versus dollar and is now in search of new destination after crossing Rs97 mark in the interbank dealings and also breaking Rs98 barrier in the open market.

Panic buying of dollar and euro was observed throughout the week. Some analysts expect that the dollar in the open market might anytime hit historic peak versus the rupee at Rs100 in coming days. It is now only Rs1.45 short of the psychological barrier. Against the dollar, the rupee has already lost Rs2.75 in the past one month and depreciated by 20 per cent in the past four years since 2008. The rupee has also hit record lows versus euro after it came under mounting pressure on the back of rising demand for dollar and euro. Euro has gained Rs9.40 against the rupee over past six months. Currently it is also riding high against the rupee after hitting Rs129 mark.

Meanwhile on the interbank market, the rupee suffered sharp losses this week after trading within a narrow band versus the dollar in the past two weeks. In the first trading session, the rupee posted 18 paisa loss on the buying counter and another 21 paisa decline on the selling counter, pushing dollar at Rs96.90 and Rs96.95, against previous weekend’s Rs96.72 and Rs96.74. In the second trading session, the rupee, while continuing its downslide against the dollar in the absence of SBP intervention, crossed Rs97 barrier after shedding 35 paisa. The dollar hit new highs and last traded at Rs97.25 and Rs97.30.

The rupee, however, managed to post marginal recovery against the dollar in the third trading session as it came out from weak spells, recovering five paisa on the buying counter and also gaining eight paisa on the selling counter to trade at Rs97.20 and Rs97.22 despite persistent high dollar demand. But this recovery proved short-lived as it posted fresh decline of 20 paisa in the fourth trading session and helped the dollar climb another peak at Rs97.40 and Rs97.42. The rupee further drifted lower against the dollar in the last trading session, suffering 25 paisa loss on the buying counter and 28 paisa loss on the selling counter before closing the week just 30 paisa short of Rs98 at Rs97.65 and Rs97.70. During the week in review, the dollar in the interbank dealings gained 93 paisa in rupee term before attaining historic highs.

In the open market, the dollar was seen riding all time high against the rupee this week. Panic dollar buying during the week exerted downward pressure on the rupee which suffered significant losses against the US currency and broke Rs98 psychological barrier in the fourth trading session, hitting historical lows on December 13, 2012. Against the dollar, the rupee traded at Rs97.40 and Rs97.60 in the first trading session of the week in review, down 0.2 per cent against last week close atRs97.20 and Rs97.40. After 20 paisa drop in the first session, it further slipped in the second trading session, losing 15 paisa at Rs97.55 and Rs97.75. In the third trading session, the dollar climbed toRs97.60 and Rs97.80 after the rupee restricted decline versus the dollar to five-paisa.

The rupee, however, failed to halt dollar’s uninterrupted upward advancement in the fourth trading session as it continued to suffer losses for the fourth straight day and crossed Rs98 barrier and with dollar changing hands at Rs98.00 and Rs98.20 after the rupee posted fresh loss of 40 paisa over the previous day close. In the last trading session, the rupee continued its downslide, further losing 35 paisa versus the dollar. At the close of the week, the dollar was trading at all-time high ofRs98.35 and Rs98.55 against the rupee. In the open market, the rupee posted cumulative loss of Rs1.15against the dollar on week over week basis.

Versus the European single common currency, the rupee was seen under tremendous pressure, hitting all-time low at Rs129 this week. Heavy demand for euro throughout the week pushed the rupee in the minus zone, leading to sharp decline in its value. After closing last week at Rs125 and Rs126, the rupee posted significant losses against euro in all the five trading sessions of this week. It lost 20 paisa at Rs125.20 and Rs126.20 in the week’s first trading session. In the subsequent four sessions, the rupee further lost Rs3. At the close of the week it was last changing hands against euroatRs128.20 and Rs129.20 after shedding 90 paisa in the fifth trading session. During this week, the rupee depreciated by 2.5 per cent against the European single common currency.

On the international front this week, the euro rose against the dollar for the first time in four sessions in NY first trading session, last up 0.4 per cent at $1.2942.

On December 11, the euro rose against the dollar for a second straight day, gaining about 0.2 per cent in December. The single currency has notched a mere 0.5 per cent gain so far in 2012.

At the close of the week on December 14, the dollar fell from a near nine-month high against the yen and dropped for the fifth straight day against the euro. Against the yen, the dollar fell 0.1 per cent to 83.53 yen, having risen as high as 83.96, its highest since March 21. Still, it was not far from its March 2012 peak of 84.17. The euro rose to a high of $1.3141, its highest since mid-September. It was last up 0.4 per cent at $1.3132. In London, the pound was up 0.2 per cent at $1.6144 against the dollar, though it was well below a six-week high of $1.6173 hit on December 12.