Weak sentiment was seen on the currency market during the week ended on February 2, 2008, economists observed. In the interbank market, the rupee lost eight paisa against dollar for buying at 62.68 and shed five paisa for selling at 62.70, they said.
The rupee was slightly lower by five paisa in relation to dollar for buying at Rs 62.70 and did not move for any side for selling at 62.80, while the euro gained Rs 1.10 at Rs 92.40 and Rs 92.50 for buying and selling, they added.
Some dealers said that importers were the active buyers of dollars to clear the payment bills. Through the whole week, it was noticed that higher oil prices in the global markets pushed the bills costlier, they said. It is most likely that the demand may go up for dollars in the coming days, if the imports go up, they said.
INTER-BANK RATES: On January 28, the rupee lost 18 paisa in terms of the dollar for buying at 62.60 and it also shed 22 paisa for selling at 62.65, dealers said. On January 29, the rupee picked up five paisa against dollar for buying and selling at 62.55 and 62.60, they said.
On January 30, the rupee lost five paisa against dollar for at 62.60 and three paisa for selling at 62.63, dealers said. On January 31, the rupee shed four paisa against dollar for buying at 62.64 and three paisa for selling at 62.66, dealers said.
On February 1, the rupee dropped nine paisa against dollar for buying at 62.73 and 10 paisa for selling at 62.76, dealers said.
On February 2, the rupee gained five paisa for buying at 62.68 and six paisa for selling at 62.70, dealers said.
WORLD VALUE OF DOLLARS: The US currency did not come out of the prevailing weakness versus the major currencies during the week.
In the first session, the dollar dipped against euro, with investors being cautious on the US currency before a Federal Reserve meeting this week at which the central bank is expected to cut interest rates again following last week's emergency slash. During the second session, in the European markets, the dollar steadied against a basket of major currencies, with investors debating the likely size of a widely expected Federal Reserve interest rate cut this week and the chances of a US recession.
During the third session, the dollar steadied against a basket of major currencies as investors awaited the Federal Reserve's US monetary policy decision shortly, which will likely be another recession-fighting rate cut.
The main question the markets were facing was whether the Federal Open Market Committee's (FOMC) cut would be a quarter or half percentage point, although some analysts were pinning an outside chance on a 75 basis point cut or even no change at all.
Amid fourth session, the dollar hit a record low versus the Swiss franc on Thursday after the Federal Reserve cut interest rates and warned more may be needed to shore up the weakening US economy. The US currency also held low against the yen, nursing the losses posted after the Fed slashed the benchmark fed funds rate a half percentage point to 3.00 percent.
During the fifth session, the dollar hovered in range of a record low against the euro before crucial US economic data due later in the day that is expected to show just how close the US economy is to a recession.
In New York market, at the final session, the dollar rose against the euro and sterling after stronger-than-expected manufacturing data offset news showing the US economy shed jobs last month for the first time in 4-1/2 years.
The US labour market contracted in January for the first time since August 2003, according to government data on Friday. That initially sparked widespread dollar selling.
OPEN MARKET RATES: On Monday, the rupee maintained its weekend level against dollar for buying at 62.65 while it shed five paisa for selling at 62.80, dealers said. The rupee picked up 12 paisa against euro, for buying and selling at Rs 91.30 and Rs 91.40, they said.
On Tuesday, the rupee shed five paisa against dollar for buying at 62.70 while it maintained its overnight level for selling at 62.80, dealers said. The rupee lost 95 paisa against euro for buying and selling at Rs 92.15 and Rs 92.25, they said.
On Wednesday, the rupee maintained its overnight levels against the dollar for buying and selling at 62.70 and 62.80, dealers said. The rupee continued its weakness against the euro, losing 10 paisa for buying and selling at Rs 92.25 and Rs 92.35, they said.
On Thursday, the rupee picked up five paisa against dollar for buying at 62.65 and maintained its overnight levels for selling at 62.80, dealers said. The rupee extended its fall in relation to the euro, dropping 65 paisa for buying and selling at Rs 92.90 and Rs 93.00, they said.
On Friday, the rupee shed five paisa in relation to dollar for buying at 62.70 and was unchanged for selling at 62.80, dealers said. The rupee rose by 10 paisa versus euro for buying and selling at Rs 92.80 and Rs 92.90, they said.
On Saturday, the rupee maintained its overnight levels against dollar for buying and selling at 62.70 and 62.80, dealers said. The rupee continued its upward march versus the euro, picking up 40 paisa for buying and selling at Rs 92.40 and Rs 92.50, they said.
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