The rupee moved cautiously in relation to the dollar on the currency market during the week ended on March 2. On the interbank market, the rupee moved down versus the dollar, losing seven paisa for buying at 98.23 and it shed six paisa for selling at 98.26.
The rupee did not move any side against the dollar for the second week in a row for buying and selling at 99.00 and 99.25, while the national currency rose by 25 paisa in terms of the euro for buying and selling at Rs 130.25 and Rs 130.50.
The rupee moved with little change against the dollar in the absence of major payment and partly because of directive by the State Bank of Pakistan (SBP), in which it said the Bank is taking steps to minimise rupee's erosion versus the dollar. In the meantime, it looks that the rupee may come under pressure in the middle of the month to clear payments. According to the central bank, country's foreign exchange reserves stood at Rs 13.185 billion dollar. The import bills are causing a fall in the reserves, they said.
Hopefully, textile and clothing experts reached 7.509 billion dollars in July-Jan, cotton yarn exports have grown by 41.6 percent during the same period, which has gone up to 1.247 billion dollar against last year.
Secondly, the European Union has lifted a ban on Pakistan's seafood products, allowing two local companies to export fishery products, this factor will cause an increase in the foreign exchange earnings for the country, analysts said.
Other experts were of the view that the Federal Board of Revenue's recent move to increase withholding tax on import of all textile raw materials and machinery from one percent to five percent through SRO 140 (i) 2013 issued under section 148 of Income Tax.
On the one hand decision may discourage importers mildly, but on the other, the move would push up the import bills, naturally it would create the shortage of dollar in the market, they said.
INTER-BANK MARKET RATES: on Monday, the rupee shed two paisa against the dollar for buying at 98.16 and the national currency also lost three paisa for selling at 98.21. On Tuesday, the rupee recovered two paisa against the dollar for buying and selling at 98.16 and 98.19. On Wednesday, the rupee shed one paisa in relation to the dollar for buying at 98.17, the national currency, however, picked up the same amount for selling at 98.18. On Thursday, the rupee shed one paisa in terms of the dollar for buying at 98.18, it also slipped by two paisa for selling at 98.20. On Friday, the rupee was down by five paisa in relation to the dollar for buying at 98.23 and it also lost six paisa for selling at 98.26.
OPEN MARKET RATES: On February 25, the rupee managed to hold the overnight levels against the dollar for buying and selling at 99.00 and 99.25. While, the rupee jumped versus the euro for buying and selling at Rs 130.50 and Rs 130.75.
On February 26, the rupee sustained week-end levels in terms of the dollar for buying and selling at 99.00 and 99.25. While, the rupee, gained 25 paisa in terms of the euro for buying and selling at Rs 131.50 and Rs 131.75. On February 27, the rupee held the overnight levels against the dollar for buying and selling at 99.00 and 99.25, while the rupee maintained its surge in terms of the euro, rising 25 paisa for buying and selling at Rs 130.25 and Rs 130.50.
On February 28, the national currency did not show any change versus the dollar for buying and selling at 99.00 and 99.25, they said. While, the rupee, which was ascending for the last several sessions in relation to the euro, tended lower, losing Rs 1.25 for buying and selling at Rs 131.00 and Rs 131.25, they added.
On March 1, no change was seen in the rupee-dollar parity rate on the open market for buying and selling at 99.00 and 99.25, while the rupee ascended versus the euro, gaining rupee one for buying and selling at Rs 130.00 and Rs 130.25.
On March 2, the rupee held the overnight levels against the dollar for buying and selling at 99.00 and 99.25, while the rupee shed 25 paisa in relation to the euro for buying and selling at Rs 130.25 and Rs 130.50.
OVERSEAS OUTLOOK FOR DOLLAR: In the first Asian trade, the yen skidded to a 33-month low against the dollar as speculation strengthened that the Japanese government is set to name two strong supporters of aggressive monetary easing to top posts at the central bank.
Britain's sterling also lost ground against major currencies, slipping to a 16-month low versus the dollar, following Moody's downgrade of the country's prized triple-A sovereign rating late on Friday.
The dollar was trading against the Indian rupee at 54.05, the greenback was at 3.0990 in terms of the Malaysian ringgit and the US currency was available at 6.2338 versus the Chinese yuan.
Inter bank buy/sell rates for the taka against the dollar on Monday: 78.90-78.92 (78.90-78.90). Call Money Rates: 07.00-09.00 percent (previous 07.00-09.50 percent).
In the second Asian trade, the euro skidded close to a seven-week low against the dollar while the yen kept some distance from multi-month lows as the spectre of political gridlock in Italy spurred traders to seek refuge in the US and Japanese currencies.
Italy's centre left won the lower house as widely expected, but projections by Italian media indicate no party or coalition will be able to form a majority in the upper house or Senate. The dollar was trading against the Indian rupee at Rs 53.87, the greenback was available at 3.1000 in terms of the Malaysian ringgit and the US currency was at 6.230 in relation to the Chinese yuan. Inter bank buy/sell rates for the taka against the dollar on Tuesday. 78.85-78.88 (78.90-78.92): Call Money Rates: 07.00-08.50 percent (previous 06.00-09.00 percent).
In the third Asian trade, the yen held onto its edge against its major counterparts in Asian trading on Wednesday as investors awaited an Italian bond auction later in the session which could give clues on the direction of the euro.
Italy's borrowing costs have soared on the back of a political stalemate following its recent election, creating a challenging environment for the country's sale of new 10-year bonds and five-year paper.
The dollar was trading versus the Indian rupee at Rs 53.86, the US currency was at 3.0985 in terms of the Malaysian ringgit and the greenback was available at 6.226 versus the Chinese yuan. Inter bank buy/sell rates for the taka against the dollar on Wednesday: 78.85-78.85 (78.90-78.92). Call Money Rates: 07.00-08.50 percent (previous 06.00-09.00 percent).
In the fourth Asian trade, the euro held its ground against the dollar and yen on Thursday, after a relatively smooth auction of Italian government bonds helped temper concerns about the country's political deadlock. Strong US business spending data also boosted investors' sentiment, easing worries about looming US fiscal spending cuts and prompting the yen to resume its descent after a brief spell of sharp gains earlier this week.
The dollar was trading against Indian rupee at Rs 54.04, the greenback was at 3.0895 in relation to the Malaysian ringgit and the US currency was available at 6.2215 in terms of the Chinese yuan. Inter bank buy/sell rates for the taka against the dollar on Thursday: 78.85-78.86 (78.85-78.85). Call Money Rates: 07.00-08.00 percent (previous 06.80-09.00 percent.
In the final session, the euro steadied in Asian trade, a day after its biggest monthly fall against the dollar in nine months, as investors took slightly disappointing Chinese factory data in stride.
The single currency's upside remained capped as political uncertainty in Italy and impending US government spending cuts sapped some investors' appetite for risk.
The dollar was trading against the Indian rupee at Rs 54.52, the greenback was at 3.0990 in terms of the Malaysian ringgit and the greenback was at 6.2227 in relation to the Chinese yuan.
At the weekend, the wide-ranging US spending cuts that automatically kicked in and threatened to dampen economic growth did little to diminish a US dollar rally which was aided by upbeat economic data.
The euro sank to a 2-1/2-month low before quickly rebounding while increased speculation the new leadership of the Bank of Japan will move quickly to loosen monetary policy sent the yen reeling.
Sterling collapsed to a fresh 2-1/2-year nadir on disappointing economic data, briefly dropping below the $1.50 level.
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