The rupee managed to hold firmness against dollar during the week ended on August 20, 2010 despite higher demand for dollars by importers to meet payment requirements. On the interbank market, the rupee shed two paisa in relation to dollar for buying and selling at 85.65 and 85.70.
On the open market, the rupee gained 10 paisa versus dollar for buying at 85.50 and five paisa for selling at 85.65. The rupee followed suit against euro, rising by 47 paisa for buying and selling at Rs 108.53 and Rs 109.03. The rupee retained its levels against dollar on easy supply of dollars. It is likely that the rupee may hold its firmness in the near future.
In the long run, the rupee may not be able to maintain its level on strong dollar demand to clear the import bills for oil and other items as, according to the State Bank of Pakistan weekly data, foreign exchange reserves fell slightly to 16.29 billion dollars.
INTER-BANK MARKET RATES: On Monday, the rupee shed five paisa in terms of dollar for buying at 85.68 and four paisa for selling at 85.72. On Tuesday, the rupee gained four paisa versus dollar for buying at 85.64 and five paisa for selling at 85.67 amid easy supply of US currency.
On Wednesday, the rupee picked up four paisa versus dollar for buying at 85.60 and 2 paisa for selling at 85.65. On Thursday, the rupee shed two paisa at 85.62 versus dollar for buying and one paisa for selling at 85.66.
On Friday, the rupee slid by three paisa against dollar for buying at 85.65 and four paisa for selling at 85.70.
WORLD VALUE OF DOLLAR: In the first Asian trade, the yen rose broadly on Monday as high-yielding currencies and Asian equities faltered, with talk of possible demand from Japanese exporters and investor fund repatriation also giving the yen a boost. Indian rupee was trading at Rs 46.76 versus dollar; Malaysian ringgit was available at 3.1830 in terms of US currency; and Chinese yuan was trading at 6.8016 versus the greenback.
Interbank buy/sell rates for the taka against dollar on Monday: 69.45/69.46 (previous 69.45/69.4580). In the second Asian trade, the dollar hovered near a 15-year low against yen, weighed down by a slide in US Treasury yields, putting the focus on whether Japanese authorities would take any measures to curb the yen's rise.
The dollar dipped as low as 85.11 yen in early Asian trade, within sight of a 15-year low of 84.72 yen struck last week on trading platform EBS. Its fall came in the wake of previous day's slide in US Treasury yields, while selling by Japanese exporters at around the 0100 GMT Tokyo fixing also weighed on it, traders said.
The Indian rupee strengthened as early gains in shares raised hopes for more foreign fund inflows, while the dollar's losses against major currencies and other Asian peers also boosted sentiment. But, dealers said, further gains were unlikely as the stock market was holding largely steady and they expected some resistance to creep in on the back of the risk aversion globally.
At 10:40 am (0510 GMT), the partially convertible rupee was at 46.64/65 per dollar, stronger than its 46.80/81 close on Monday. It moved in the 46.6350-46.70 range.
Malaysian ringgit was trading at 3.1655 versus dollar and Chinese yuan was available at 6.7947 in terms of the dollar. Interbank buy/sell rates for the taka against dollar on Tuesday: 69.50/69.50 (previous 69.45/69.46). Call Money Rates: 8.00-9.25 percent (previous 7.00-10.25 percent).
In the third Asian trade, the yen rose, with traders citing yen buying by Japanese investors and exporters, while Canadian dollar held gains scored on news of a huge take-over bid by global miner BHP Billiton for Canada's Potash Corp.
The yen dipped against dollar and euro in early Asian trading, staying on the defensive after retreating the previous day as US and European shares rose and US Treasury yields edged higher.
But the yen later received a boost, with market players citing yen buying by Japanese investors and exporters in yen crosses and the dollar. Indian rupee was trading at Rs 46.64 versus dollar; Malaysian ringgit was available at 3.1580 in terms of US currency, and Chinese yuan was available at 6.787 in terms of the US currency. Interbank buy/sell rates for the Bangladesh taka against dollar on Wednesday: 69.54/69.54 (previous 69.50/69.50).
In the fourth Asian trade dollar edged up against yen on Thursday with investors being reluctant to chase yen higher as they waited to see if the Bank of Japan or the government would take new steps to rein in the yen's rise.
Earlier, rumours had circulated in the market that the BoJ would hold an emergency policy meeting at 2 pm (0500 GMT). That followed a media report that the central bank had started considering additional monetary easing steps.
The dollar briefly pared its gains against yen after sources familiar with the matter said the Bank of Japan was highly unlikely to hold an emergency meeting on Thursday.
Indian rupee was trading at Rs 46.56 versus dollar; Malaysian ringgit was available at 3.1290 in terms of the US currency; and Chinese yuan was trading at 6.791 against dollar.
In the final Asian trade, the dollar steadied against yen but stayed within reach of a 15-year trough, hit last week, after weaker US data prompted investors to sell higher-yielding currencies and stocks on risk aversion.
Indian rupee was trading at Rs 46.51 versus dollar; Malaysian ringgit was available at 3.1320 in terms of US currency; and Chinese yuan was trading at 6.7892 versus dollar.
The dollar and yen might extend gains this week as worries that the global economy has been losing steam burnish the currencies' safe haven appeal.
OPEN MARKET RATES: On August 16, the rupee gained 10 paisa against dollar for buying at 85.50, while it did not move to any side for selling at 85.70. The rupee retained its weekend levels against euro for buying and selling at Rs 109.00 and Rs 109.50.
On August 17, the rupee retained its overnight level against dollar for buying at 85.50, while it gained five paisa for selling at 85.65. The rupee could not maintain its overnight levels against the euro, shedding 40 paisa for buying and selling at Rs 109.40 and Rs 109.90. On August 18, the rupee rose by five paisa versus US currency for buying and selling at 85.45 and 85.60. The rupee also appreciated by 20 paisa against euro for buying and selling at Rs 109.20 and Rs 109.70.
On August 19, the rupee maintained its overnight levels in relation to US currency for buying and selling at 85.45 and 85.60. The rupee gained 60 paisa against euro for buying and selling at Rs 108.60 and Rs 109.10.
On August 20, the rupee slipped in terms of dollar by five paisa for buying and selling at 85.50 and 85.65. The rupee maintained its surge against euro for buying and selling at Rs 108.53 and Rs 109.03.
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