THE rupee came under heightened pressure from both the dollar and the euro last week. It dropped past the 102-mark against the dollar in interbank dealings and traded past the 104-mark in the open market.

Sentiments weakened in both the local currency and equity markets as weak economic data from China and a further drop in crude prices led to a global selloff and a rush towards safe haven instruments like US Treasuries.

On the interbank market, the rupee commenced the week by losing 11 paisas for buying and 12 paisas for selling, sending the dollar up at Rs101.95 and Rs101.97 in the first trading session, against the prior week’s close of Rs101.84 and Rs101.85. The rupee-dollar parity remained unchanged in the second trading session.

The rupee then recovered six paisas for buying and seven paisas for selling, as the dollar slipped to Rs101.89 and Rs101.90 in the third trading session. However, the rupee shed three paisas for buying and four paisas for selling in the fourth trading session, as the greenback ended the day at Rs101.92 and Rs101.94.

The rupee depreciated by 18 paisas against the dollar in interbank dealings and by 50 paisas in the open market last week

The dollar then rose sharply in the last trading session, gaining 10 paisas to close the week at Rs102.02 and Rs102.04. The rupee depreciated by 18 paisas in the interbank market last week.

Meanwhile, the rupee commenced the week in the open market by losing 20 paisas in the first trading session, sending the dollar up at Rs103.20 and Rs103.40, against the prior week’s close of Rs103.00 and Rs103.20.

The rupee dropped a further 10 paisas in the second trading session, allowing the greenback to rise to Rs103.30 and Rs103.50. The rupee-dollar parity then remained unchanged in the third trading session.

The rupee then shed another 20 paisas in the fourth trading session, enabling the dollar to rise to Rs103.50 and Rs103.70 . There were reports that the dollar was unofficially going for as high as Rs104 to Rs104.20 at one stage.

The rupee-dollar parity remained unchanged at Rs103.50 and Rs103.70 in the last trading session. The rupee thus depreciated by 50 paisas in the open market last week.

The rupee posted a similar performance against the euro. It started the week by gaining 10 paisas, sending the euro down to Rs114.00 and Rs115.00 against the prior week’s close of Rs114.10 and Rs115.10.

It picked up another 20 paisas in the second trading session, as the euro dipped to Rs113.80 and Rs114.80.

However, the euro regained 20 paisas in the third trading session and ended the day at Rs114.00 and Rs115.00. It then rose by 125 paisas in the fourth trading session, subsequently ending the day at Rs115.25 and Rs116.25.

The rupee then shed 100 paisas in the last trading session, allowing the euro to rise to Rs116.25 and Rs117.25. During the week, the rupee lost 215 paisas against the euro.

Published in Dawn, Economic & Business, August 24th, 2015

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