Rupee maintained its almost weekend levels versus dollar for buying and selling at Rs57.72 and Rs57.74 on the opening day of the week in inter-bank market. On June 17, the rupee/dollar parity remained unchanged as supply side was strong to meet dollar requirements.
On June 19, it failed to maintain its overnight stable trend versus the dollar in the inter-bank market, shedding two paisa for buying and selling at Rs57.75 and Rs57.76,respectively. On June 20, it shed five paisa versus the dollar at Rs57.80 and Rs57.82, as the rupee’s slightly easier tone to buying pressure was caused by commercial payments.
In the kerb market rupee gained two paisa against the dollar for buying and selling at Rs57.88 and Rs57.93on June 16. The domestic currency, however, lost 15 paisa versus the euro for buying and selling at Rs68.55 and Rs68.85, on June 17.
Rupee maintained a firm trend versus the dollar for buying and selling at Rs57.88 and Rs57.98 on June 18. As a result of sliding trend in the world markets, euro shed 35 paisa versus rupee in the kerb market at Rs68.20 and Rs68.50.
On June 19, the rupee did not show any change versus the dollar for buying and selling at Rs57.88 and Rs57.93. However, it recovered 50 paisa in relation to the euro for buying and selling at Rs67.70 and Rs68.00.
On June 20 the rupee in the kerb gained three paisa against dollar for buying and selling at Rs57.90 and Rs57.94, but it lost 30 paisa in relation to the euro at Rs67.35 and Rs67.65.
In the international financial market the dollar rose on June 16, boosted by a strong regional US manufacturing report which hit shortly after a sour consumer sentiment report last week.
The US benchmark interest rate of 1.25 per cent is among the lowest of the major industrialized economies, putting the US assets and dollar at a disadvantage as investors searching for higher yields take their cash elsewhere.
In early European trade, the euro came within a fraction of a cent of May’s record high at $1.1932, but was driven back by profit-taking.
The euro traded at $1.1840, down 0.24 per cent from previous week New York close. The dollar rose to 117.60 yen, up 0.18 per cent.
On June 17, dollar recovered recent losses against most major currencies after data on the US consumer prices dampened speculation that the Federal Reserve will cut interest rates aggressively next week, leaving many traders anticipating a shallower trim.
Dollar has fallen sharply against other major currencies in recent sessions, weakened by the prospect of lower interest rates, which would reduce returns on the US assets and drive investors toward higher-yielding instruments overseas.
Euro was mired near $1.1790 against the dollar, off session lows but still down 0.26 per cent from its previous US close and more than a cent from its record high at $1.1932.
Dollar bought 118.10 yen up 0.40 per cent on the day, as traders were mindful that Japan could sell its currency to cheapen exports. In a reflection of the market’s abiding obsession with high-yielding assets, the dollar tested a new 4-1/2-year low against sterling above $1.69. The pound soared after the Bank of England Monetary Policy Committee member Stephen Nickell said he saw no forces that would drive the pound lower.
On June 18 dollar advanced against euro and yen as a reduced chance that the Federal Reserve will lower interest rates sharply next week encouraged traders to reduce bets the dollar will fall.
Euro clung to its lows after Bank of France Governor was acquitted in a banking scandal trial, removing a major obstacle to his succeeding Wim Duisenberg as president of the European Central Bank. It traded below $1.17 against the dollar down 0.75 percent from its prior US close and more than 2 cents from a record high reached in May.
Dollar traded around 118.25 yen paring its gains but still 0.15 per cent higher on the day. Versus the Swiss franc, the US currency bought 1.3217 francs up one per cent on the session. Sterling set a six-week high on the euro on Wednesday while retreating about a cent from recent 4 1/2-year high versus dollar as continued investor demand for attractive UK yields was partly offset by a dollar rise. Against dollar, sterling was down a third of a per cent at $1.6769, following a 0.70-per cent rise in the greenback on the euro.
The dollar fell from a one-month high against the euro on June 19, its gains erased after a closely watched gauge of the US manufacturing sector deflated market hopes for an imminent economic rebound.
The dollar also cut its gains against the yen, changing hands around 118.37 yen after having reached levels above the 119 figure still up 0.45 per cent on the day.
In a reflection of the market’s risk aversion, the Swiss franc reversed its losses despite Switzerland’s open call for a weaker currency. The euro traded near 1.5451 francs, well below the 2-1/2 year high it reached against the franc at 1.5549 francs during London trading.
The US currency traded around 1.3180 francs off 0.36 per cent after having hit its highest since May 6 above 1.33 francs. Sterling set seven-week highs against the euro, but quickly lost its poise after an unexpected fall in retail sales and a bleak manufacturing survey fuelled talk that interest rate cuts may be on the cards.
The British pound lost a quarter per cent on the day versus the broadly rebounding dollar, retreating further from 4 1/2-year highs set against the US currency earlier in the week. Sterling was slightly weaker against the euro at 69.75 pence and down from the seven-week high of 69.27 pence.
It was at $ 1.6735 versus dollar, down from the 4 1/1-year high at $ 1.6903.
Dollar extended its losses against the yen on June 20 in Asia following sharp falls in New York in the wake of a key manufacturing survey for the US mid-Atlantic region that deflated hopes for a robust economic recovery.
In late Asian trade, dollar was quoted at 118.23/26 yen down from around 118.45 in late US trade and below a two-week high of 119.12 yen hit on June 19. It fell as low as 118.01 yen earlier on June 20. Sterling retreated to a one-week low against the dollar but remained firm against the euro as the greenback bounced across the board on the view an expected US rate cut next week would support economic growth.
Sentiment turned a bit euro negative and people are beginning to buy dollars. Sterling had lost two-thirds of a percent against the dollar to $1.6679 having posted a 4-1/2 year high only earlier this week. Against the euro it held at 69.76 pence.