The rupee resisted sharp fall against dollar while it recovered its lost ground in terms of euro during the week ended on July 26, 2008. The rupee shed 28 paisa for buying at 71.18 and 24 paisa for selling at 71.22 against dollar on the interbank market.
It, however, gained sharply against the US currency on the open market, with a gain of 90 paisa for buying at 70.80 and 65 paisa for selling at 71.40. It also gained 60 paisa for buying at Rs 111.75 and 55 paisa for selling at Rs 112.00 against euro.
According to the State Bank of Pakistan (SBP), the country's foreign reserves fell 102 million dollars to 10.728 billion dollars due to outgoings for import payments.
To halt the erosion in the value of the rupee, the SBP itself is clearing all payments and it is expected that it may take more steps to stabilise the rupee-dollar official parity rates.
An official of the World Bank said that Pakistan's economy is facing many problems. He said that the subsidy given to the energy sector would have to be withdrawn and the government's borrowings from the central bank would have to be halted for financial stability.
Many economists were of the view that uncertainties over the political and economic sectors may not help in restoring the confidence of the investors in the world and locally, as well. The government has to adopt a policy which can improve law and order situation in the country and it should also make strategies to the relief of the masses.
INTER-BANK RATES: On Monday, the rupee lost 45 paisa for buying at 70.95 and 38 paisa for selling at 70.98 against dollar.
On Tuesday, the rupee gained five paisa against dollar for buying and selling at 70.90 and 70.93.
On Wednesday, the rupee rose by five paisa in relation to dollar for buying at 70.85 and three paisa for selling at 70.90.
On Thursday, the rupee shed five paisa in relation to dollar for buying and selling at 70.90 and 70.95.
On Friday, the rupee maintained its overnight levels against dollar for buying and selling at 70.90 and 70.95, respectively.
On Saturday, the rupee fell by 28 paisa against dollar for buying at 71.18 and 27 paisa for selling at 71.22 due to importers' rush for the greenback.
DOLLAR'S VALUE VERSUS MAJOR CURRENCIES: Amid first session of the week, the US dollar was weaker, weighed down by lingering worries about the health of the US financial sector ahead of earnings reports from regional banks this week.
The dollar inched down against a basket of currencies to 72.10 from Friday's levels. In the second session of Asian trade, the dollar was steady after falling near a record low against the euro the previous day as investors believe the worst of the problems in the US financial system are not yet over.
While the dollar has recovered somewhat after better results than expected from big financial institutions such as Citigroup JPMorgan Chase and Bank of America investors are awaiting more earnings reports this week.
In the next Asian trade, the dollar stayed firm, holding much of the ground gained against the euro and yen the previous day on a verbal lift from top US officials and a sharp slide in the price of crude oil.
Philadelphia Federal Reserve President Charles Plosser said on Tuesday that rising inflation could force the Fed to start raising rates even before labour and financial markets recover, giving a big lift to the dollar.
During the fourth session, the dollar hovered near a one-month high against the yen, supported by the previous day's drop in oil prices and signs of improved confidence in the US financial sector.
Oil extended its losses on Wednesday to fall more than $20 from the all-time peak above $147 a barrel hit on July 11, while US financial shares rose after President George W. Bush dropped a threat to veto a housing rescue bill.
At the final session, the US dollar rose against the Japanese yen in New York, after a trio of better-than-expected data injected a dose of optimism about the US economy.
The upbeat readings on US durable goods orders, new-home sales, and a rebound in consumer sentiment from a 28-year low allayed some of the recent gloom over the economy and financial markets, sending stocks higher and giving a boost to the beleaguered US currency.
OPEN MARKET RATES: On July 21, the rupee lost 90 paisa against dollar for buying at 71.70 and 75 paisa for selling at 72.05, dealers said. The rupee also shedding 95 paisa versus the euro for buying at Rs 112.35 and 105 paisa for selling at Rs 112.55, they said.
On July 22, the rupee dropped 30 paisa against dollar for buying at 72.00 and 25 paisa for selling at 72.30, dealers said. The rupee declined 90 paisa versus euro for buying and selling at Rs 113.25 and Rs 113.45, dealers said.
On 23 July, the rupee rose 20 paisa for buying at 71.80 and 10 paisa for selling at 72.20 against dollar, dealers said.
The rupee also appreciated in terms of euro, rising 90 paisa for buying at 112.35 and 95 paisa for selling at 112.50, dealers said.
On July 24, the rupee maintained its overnight levels against dollar for buying and selling 71.80 and 72.20, dealers said. The rupee extended its gains versus the euro, gaining 75 paisa for buying at 111.60 and 70 paisa for selling at Rs 111.80, dealers said.
On July 25, the rupee shed 30 paisa for buying at 72.10 against dollar and 10 paisa for selling at 72.30, dealers said. The rupee followed suit versus the euro, losing 45 paisa for buying at 112.05 and 40 paisa for selling at 112.20, dealers said.
On July 26, the rupee recovered 30 paisa versus dollar for buying at 70.80 and 90 paisa for selling at 71.40, dealers said. It followed the same pattern against the euro, inching up 30 paisa for buying at Rs 111.75 and 20 paisa for selling at 112.00, they added.