Increasing dollars' demand pushed the rupee into the negative territory on the ground of expanding demand of the US currency mainly by the corporate sector to meet the genuine payments during the week (27 February-March 04), money experts observed.
In the interbank market, the rupee managed to limit sharp decline in its value versus the dollar, shedding eight paisa for buying and selling at 59.93 and 59.95, they said.
The rupee, somehow, maintained a firm posture in terms of the greenback for buying and selling in the open market at 60.00 and 60.10, it, however, failed to hold it level in relation to the euro, losing steeply by Rs 1.15 at Rs 72.00 and Rs 72.10, they said.
The rupee, in the interbank market, failed to show its muscles against the US currency on rising demand for dollars to meet the corporates' buying needs, money experts said.
According to the banking sources, the rupee fell with modest losses as the central bank bought dollars from the banks to keep it's reserve position stable.
Most of the economists were of the view that under the circumstances, the rupee might show modest weakness on rising dollar demand.
The fact is an unprecedented rise in the imports, which is pushing up payment after the sharp increase in the world oil prices, analysts said. This factor may help in reaching the country's trade deficit to the level of 10 billion dollars in the days to come, they added.
The country's reserves hit an all-time high of 13 billion dollars in April, 2005, but have subsequently declined because of routine debt payments and a rising import bills.
WORLD MARKET SCENARIO: On expectations of the Bank of Japan (BoJ) will soon scrap its ultra-loose monetary policy and eventually raise interest rates, strengthening the yen's value against the dollar and euro, dealers said.
The Japanese currency unit rallied to a one-month high against the dollar and six-week peak versus the euro.
On Tuesday, the dollar moved little versus the leading currencies in the international markets ahead of the expectations that the Bank of Japan will end its super-easy monetary policy soon.
ON WEDNESDAY, THE REUTERS ADDS: the dollar struck a fresh one-month low against the yen after weak US economic data dented expectations the Federal Reserve will boost interest rates two more times before the middle of the year.
On Thursday, the dollar posted fresh gains versus the major currencies after upbeat US factory reading, dealers said. In the overseas markets, the yen was down versus the dollar despite the strong Consumer Price Index (CPI), dealers said.
On Friday, the yen was down versus the dollar despite the strong Consumer Price Index (CPI), dealers said. At the weekend, the dollar maintained stable trend versus the major currencies on the back of positive US services sector data.
INTER-BANK MARKET: On February 27, persisting dollar buying pressure forced the rupee to give up weekend's firmness versus the US currency, falling three paisa for buying and selling at 59.86 and 59.88, respectively.
On February 28, the rupee continued its overnight weakness versus the dollar, losing three paisa for buying at 59.89 and slid two paisa for selling at 59.90, respectively.
On March 1st, the rupee, dropped by more than four paisa for buying at 59.93 and 59.95, respectively.
On March 02, the rupee shrugged off its overnight weakness in terms of the dollar, picking up two paisa for buying and selling at 59.91 and 59.93, currency experts said.
On March 03, the rupee tumbled with modest slide versus the dollar, falling three paisa on the buying side at 59.94 and slid two paisa for selling at 59.95, monetary observers said. On March four, the rupee depicted slight changes versus the dollar for buying and selling at 59.93 and 59.95, money experts said.
OPEN MARKET RATES: On Monday, the rupee did not show any change against the dollar for buying at 60.00 and it rose by two paisa for selling at 60.05, dealers said.
The rupee extended its ground in relation to the euro as it managed to gain 10 paisa for buying at Rs 70.85 and Rs 70.95 for buying and selling, they added.
On Tuesday, due to extended demand for dollars by the banks, the rupee shed two paisa versus the dollar for buying at 60.02 and 60.07, dealers said.
The rupee managed to gain 15 paisa in relation to the euro for buying and selling at 70.70 and 70.90, they added.
On Wednesday, the rupee shed three paisa versus the dollar for buying and selling at 60.05 and 60.10, they added.
The rupee also came under pressure versus the euro as it managed to recover its ground on the back of falling demand of dollars in the world market in relation to the major currencies, they said.
The single European currency gained 55 paisa versus the local currency for buying and selling at Rs 71.25 and Rs 71.35, they added. On Thursday, the rupee also gained five paisa against the dollar for buying and selling at 60.00 and 60.05, they added. The rupee, however, lost five paisa versus the euro for buying and selling at Rs 71.30 and Rs 71.40, they said.
On Friday, open market rates not received as most of the trading centre remained closed due countrywide strike. On Saturday, the rupee moved little against the dollar as it did not show any change for buying at 60.00 while it shed five paisa for selling at 60.10, dealers said.
The rupee, however, lost 70 paisa against the euro for buying and selling at Rs 72.00 and Rs 72.10, they said.
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