Khanani & Kalia International (Pvt) Limited weekly review of currency notes on Sunday (May 07, 2006)
The currency moved both ways mainly because of its rise in the infer bank and slight increase in overall buying from customers in the kerb.with gold price touching all time high in the local market, Short term investors also came forward which pushed rupee down on the desks. However national currency remained technically under comfort as dollar fell victim to serve selling pressure in major world markets.
Since dollar continued to trade on a strong footing in the inter bank, therefore, rupee did not succeed in resisting this pressure. Consistent demand mainly from the importers thus bringing rupee under fundamental stress. On world desks, dollar sensed initially and extended a rebound from a one-year low against the euro and a seven-month low versus the yen supported by a report that the Federal Reserve chief said markets had misread his congressional testimony last week.
However the dollar resumed its downward trend against euro and pound sterling and traded near its one year lows on the back of stronger than expected manufacturing data from Euro zone and UK. It stumbled against the euro, sterling, and most notably, the Aussie in Wednesday trading while prompting the sharp decline was a surprise 25-basis point rate hike by the Reserve Bank of Australia.