THE RUPEE: marginal gains

The rupee managed to show modest improvement against the dollar on the money market during the week, ended on Jan 19, 2019 The rupee appreciated by 15 paisas versus the dollar for buying and selling at Rs 138.80 and Rs 138.82.
INTER-BANK MARKET: OPEN MARKET RATES: The rupee firmly held the present levels versus the dollar for buying and selling at Rs 138.80 and Rs 139.30. While, the rupee gained 80 paisas against the euro for buying and selling at Rs 157.50 and Rs 159.00.
Commenting on the national currency's performance last week, marketmen said that the rupee sustained the present levels, but it may come under pressure slightly versus the dollar before announcement of mini-budge, which is likely next week.
They said that economic condition is not so good due to lack of confidence among businessmen and traders. Many businessmen and traders are still in search of guiding factors to restore their confidence, they said. It's necessary that the government must come forward to bring the economy back on track, and this is not possible without creating business-friendly atmosphere among the traders.
Whereas, the latest edition of Global Economic Conditions Survey (GECS) from ACCA (the Association of Chartered Certified Accountants) and IMA (Institute of Management Accountants) finds Pakistan's economic confidence fell sharply in the final quarter of 2018.
The global poll of 3,800 accountants found Pakistan's economy to be amongst the lowest in the South Asia region as it continues to struggle with macroeconomic imbalances. Other regions recorded a negative confidence score with signs of growth weakening in the world's three biggest economies - the US, China and the Eurozone. Global economic confidence fell for the third consecutive quarter in Q4 2018, ending the year at an all-time low.
INTER-BANK MARKET: On Monday, the rupee shed seven paisas versus the dollar for buying at Rs 138.93 and it also lost nine paisas for selling Rs at Rs 138.95. On Tuesday, the rupee gained three paisas versus the dollar for buying and selling at Rs 138.90 and Rs 138.92.
On Wednesday, the rupee gained two paisas versus the dollar for buying and selling at Rs 138.89 and Rs 138.91. On Thursday, the rupee moved little versus the dollar for buying and selling at Rs 138.90 and Rs 138.91. On Friday, the rupee showed rising trend versus the dollar for buying and selling at Rs 138.80 and Rs 138.82.
OPEN MARKET RATES: On Jan 14, the rupee sustained overnight level in terms of the dollar for buying at Rs 138.80, it however, gained 10 paisas for selling at Rs 139.20. The rupee shed 10 paisas versus the euro for buying at Rs 158.30 while it gained the same amount for selling Rs 159.80.
On Jan 15, the rupee sustained overnight level in terms of the dollar for buying and selling at Rs 138.80 and Rs 139.20. The rupee rose by 30 paisas versus the euro for buying and selling at Rs 158.00 and Rs 159.50.
On Jan 16, the rupee retained overnight level in terms of the dollar for buying and selling at Rs 138.80 and Rs 139.20. The rupee rose by 50 paisas versus the euro for buying and selling at Rs 157.50 and Rs 158.50.
On Jan 17, the rupee sustained overnight level in terms of the dollar for buying at Rs 138.80, it however, shed 10 paisas for selling Rs 139.30. The rupee lost 25 paisas against the euro for buying and selling at Rs 157.75 and Rs 159.25.
O Jan 18, the rupee did not show any change in terms of the dollar for buying at Rs 138.80, it however, shed 10 paisas for selling Rs 139.30. The rupee shed slightly against the euro for buying and selling at Rs 157.80 and Rs 159.30.
On Jan 19, the rupee held the overnight levels in terms of the dollar for buying and selling at Rs 138.80 and Rs 139.30. While, the rupee gained 30 paisas against the euro for buying and selling at Rs 157.50 and Rs 159.00.
In the first Asian trade, the dollar rose against most of its peers on Monday, although heightened investor expectations that the Federal Reserve will not raise rates this year are most likely to cap the greenback's gains.
The Australian dollar and New Zealand dollar edged lower versus the dollar in early Asian trade, falling 0.2 percent and 0.1 percent, respectively.
Both currencies had gained around 1.5 percent versus the dollar last week as risk sentiment improved on hopes for both a US-Sino trade deal and more aggressive stimulus from Chinese policymakers to support its ailing economy.
The dollar index was at 95.68, marginally higher in early Asian trade.
The dollar was available against the Indian rupee at Rs 70.670, the US currency was at 4.094 in terms of the Malaysian ringgit and the greenback was at 6.756 in relation to the Chinese yuan.
In the second Asian trade, the dollar weakened on Tuesday on heightened expectations the Federal Reserve will hold off on raising rates this year due to a slowdown in global growth, while sterling edged up ahead of Britain's parliamentary vote on its Brexit plan.
Worries over the US economy losing steam as well as a shock contraction in Chinese trade have fanned worries about a sharp global slowdown, which will likely keep the Fed from tightening monetary policy further this year. The dollar index weakened by 0.12 percent to 95.48.
Interest rate futures markets are pricing in no further US rate hikes in 2019. Fed Chairman Jerome Powell said last week the US central bank has the ability to be patient on monetary policy given that inflation remains stable.
The dollar was available against the Indian rupee at Rs 70.935, the greenback was at 4.095 versus the Malaysian ringgit and the US currency was at 6.753 in terms of the Chinese yuan.
In the third Asian trade, the pound steadied on Wednesday but remained on the back foot following a volatile overnight session after British lawmakers defeated Prime Minister Theresa May's Brexit divorce deal by a crushing margin.
Parliament on Tuesday voted 432-202 against May's deal, the worst parliamentary defeat for a government in recent British history.
The dollar index against a basket of six major currencies was effectively unchanged at 96.017 after climbing almost 0.5 percent the previous day, when it brushed an 11-day high of 96.261.
The dollar was trading against the Indian rupee at Rs 71.053, the greenback was at 4.111 in terms of the Malaysian ringgit and the US currency was available at 6.767 versus the Chinese yuan.
In the fourth Asian trade, the dollar took a breather on Thursday following its recent strong gains against key rivals, while sterling steadied after British Prime Minister Theresa May's government won a no-confidence vote in parliament.
The dollar index, which measures the greenback against six major peers, stood at 96.055 after gaining half a percent during the previous two sessions.
The US currency largely held onto its gains against the euro as persistent worries about the euro zone economy weigh on the single currency.
The dollar was trading a shade lower on the euro at $1.1399 after rising five straight sessions against the single currency, during which it gained about 1.5 percent.
The dollar was trading against the Indian rupee at Rs 71.275, the greenback was at 4.111 versus the Malaysian ringgit and the US currency was available at 6.767 in terms of the Chinese yuan.
In the final Asian trade, the dollar was firm against the yen on Friday as growing optimism on progress in Sino-US trade talks supported broader appetite for risk.
A Wall Street Journal report on Thursday that US Treasury Secretary Steven Mnuchin had considered easing tariff imposed on Chinese imports lifted sentiment though a Treasury spokesman later denied the report.
"The reaction of the market to the report shows the overall optimistic view (is) spreading out across the foreign exchange market," said Masafumi Yamamoto, chief currency strategist at Mizuho Securities.
Chinese Vice Premier Liu He will visit the United States on Jan. 30 and 31 for the latest round of trade talks aimed at resolving the trade standoff between the world's two largest economies.
The dollar index, which measures the greenback against six major peers, was a shade higher at 96.088 after briefly rising to a near two-week high of 96.264 during the previous session.
The dollar was trading against the Indian rupee at Rs 71.108, the greenback was available at 4.114 in terms of the Malaysian ringgit and the US currency was at 6.778 versus the Chinese yuan.
In the final US trade, the dollar held firm against its rivals on Friday, set for its first weekly gain since mid-December on optimism about talks to end the trade war between China and the United States.
Media reports on Thursday and Friday suggested both countries were considering concessions ahead of a Washington visit from Chinese Vice Premier Liu He on Jan. 30 and 31 for talks aimed at resolving the trade standoff between the world's two largest economies.
China has offered to go on a six-year buying spree to ramp up imports from the United States in order to reconfigure the relation between the two countries, Bloomberg reported on Friday, citing people familiar with the matter.
US Treasury Secretary Steven Mnuchin discussed lifting some or all tariffs on Chinese goods and suggested offering a tariff rollback during the trade discussions scheduled for Jan. 30, the Wall Street Journal reported on Thursday, citing people familiar with the internal deliberations.