The rupee mostly held its ground against the dollar in the local currency market last week, as the effects of foreign inflows and the dollar’s rise against global currencies largely cancelled each other out.

On the interbank market, the rupee started the week by dropping 12 paisas for buying and 10 paisas for selling owing to a rise in demand for the forex currency by importers. The dollar thus ended the first trading session at Rs101.97 and Rs101.99, against the prior week’s close of Rs101.85 and Rs101.88.

But the local currency then regained one-paisa in the second trading session, as the greenback ended the day at Rs101.96 and Rs101.98. The rupee picked up another paisa in the third trading session, when the dollar last changed hands at Rs101.95 and Rs101.97.

The dollar appreciated by one-paisa in interbank dealings and by 20 paisas in the open market last week

It rose by a further two paisas in the fourth trading session, as the dollar ended the day at Rs101.93 and Rs101.95. The rupee then gained a relatively bigger seven paisas in the last trading session, as the greenback closed the week at Rs101.86 and Rs101.88.

As a result, the rupee depreciated by a net one-paisa against the dollar in the interbank market last week.

In the open market, the selling of dollar by exporters and banks and a higher opening in the domestic stock market supported the rupee, according to independent reports. But the dollar’s strength against major currencies limited the rupee’s gains.

The rupee commenced the week in the open market unchanged from the prior week’s close of Rs102.20 and Rs102.40. In the second trading session, it retained its overnight rate for buying but lost 10 paisas for selling, as the dollar ended the day at Rs102.20 and Rs102.50.

The rupee then lost 20 paisas for buying and 10 paisas for selling in the third trading session, allowing the greenback to rise to Rs102.40 and Rs102.60. The rupee-dollar parity then stayed unchanged in the remaining two trading sessions of the week.

As a result, the dollar managed to appreciate by 20 paisas in the open market last week.

The rupee displayed a slightly different performance against the euro, rising sharply to get below the 110-mark. However, it had started the week by shedding 55 paisas, sending the euro to Rs111.95 and Rs112.20, against the previous week’s close of Rs111.40 and Rs111.65.

But it rebounded in the second trading session and rose by 110 paisas, as the single currency ended the day at Rs110.85 and Rs111.10. The rupee inched up by a further five paisas, as the euro slipped to Rs110.80 and Rs111.05 in the third trading session.

The local currency gained another 55 paisas, pushing the euro further down to Rs110.25 and Rs110.50. It then rose by a big 150 paisas in the last trading session, as the euro closed the week at Rs108.75 and Rs109.00. On a weekly basis, the rupee appreciated by 265 paisas against the euro.

Published in Dawn, Economic & Business, April 13th, 2015

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