Floods of dollars provided support to the rupee during the week ended on August 9, 2007. In the interbank market, the dollar was available at 60.61 and 60.63 for buying and selling, respectively.
In the open market, it rose by five paisa against the US currency at 60.85 and 60.90 for buying and selling, but it lost heavily versus euro, dropping 66 paisa at Rs 83.41 and Rs 83.51 for buying and selling, dealers said.
The inflow of the US currency was high despite political uncertainty in the country, money experts said. They attributed the rise in dollars' supply to the increase in remittances by Pakistani expatriates due to approaching Ramazan and Eid-ul-Fitr.
The foreign exchange reserves crossed 16 billion dollars due to healthier trend in remittances, they said. In the meantime, it is expected that the rupee may come under pressure as demand by stock market small investors might increase if the share prices again started showing weakness following political instability in the country, currency analysts said.
INTER-BANK RATES:
On Monday, the rupee touched new low at 60.80 and 60.82 per dollar due to strong demand by importers, dealers said. On Tuesday, the rupee gained five paisa for buying and selling at 60.75 and 60.77, dealers said.
On Wednesday, the rupee posted fresh gain of eight paisa in relation to dollar for buying and selling at 60.67 and 60.69, dealers said. On Thursday, the rupee was up by 10 paisa in relation to dollar for buying and selling at 60.57 and 60.59, dealers said. On Friday, the rupee held its overnight levels against dollar for buying and selling at 60.57 and 60.59, dealers said.
On Saturday, the rupee shed four paisa against dollar for buying at 60.61 and it dropped three paisa for selling at 60.63, dealers said.
WORLD VALUE OF DOLLAR:
In the first session of the week, the dollar steadied versus euro at the start of a week when US data shed light on the extent to which the credit market turmoil was taking toll on economic growth.
The yen edged lower and high-yielding currencies gained as risk aversion eased after the Federal Reserve and US government promised to shelter the economy from the subprime mortgage crisis.
During the second session, the dollar was steady against euro and yen as players awaited a series of US economic data to be released starting later in the day for clues on how much the credit market turmoil has affected growth.
Activity was subdued as US markets were closed on Monday for the Labour Day holiday, and investors were likely to follow stock markets closely for signs of risk-taking appetite, traders said.
During the third session of the week, the dollar gave up its overnight firmness against yen, as the Japanese currency gained against dollar and euro as sliding Tokyo shares dampened investor appetite for risk and triggered an unwinding of carry trades.
During the fourth session, the yen edged up across the board as investors trimmed risky positions in higher-yielding currencies on worries about the potential economic damage from the ongoing troubles in credit markets.
During the final session, the dollar hovered near a one-month low against a basket of major currencies as investors looked to a US jobs report later in the day for signs that the housing crisis is hurting the broader labour market.
In the New York and European markets, the dollar tumbled on Friday as data showed US non-farm payrolls contracted in August for the first time in four years, suggesting a housing slump and credit crisis have started to damage US growth. The dollar fell to 114.31 yen from around 115.20 yen before the report.
OPEN MARKET RATES:
On September 3, the rupee maintained its overnight levels against dollar for buying and selling at 60.90 and at 60.95, dealers said. The rupee lost 13 paisa in relation to euro for buying and selling at Rs 82.75 and Rs 82.85, they added.
On September 4, the rupee lost five paisa against dollar for buying and selling at 60.95 and 61.00, they said.
The rupee, however, gained 12 paisa against euro for buying and selling at Rs 82.63 and Rs 82.75, they added. On September 5, the rupee lost five paisa against dollar for buying and selling at 61.00 and 61.05, they said.
The rupee, however, picked up 16 paisa against euro for buying and selling at Rs 82.47 and Rs 82.57, they said. On September 6, the rupee lost five paisa against dollar for buying and selling at 60.95 and 61.00, they said.
The rupee also lost 30 paisa against euro for buying and selling at Rs 82.77 and Rs 82.87, they said. On September 7, the rupee picked up 10 paisa against the greenback, dealers said.
The rupee shed three paisa against euro for buying and selling at Rs 82.80 and Rs 82.90, they said. On September 8, the rupee was down by five paisa in relation to dollar for buying at 60.85 while it did not show any change for selling at 60.90, they said. The euro touched the new high after breaking the barrier of Rs 83 and the rupee lost 61 paisa for buying and selling at Rs 83.41 and 83.51, they said.
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