The rupee resisted sharp losses against dollar during the week ended on October 10, 2009. On the interbank market, the rupee lost 2 paisa in relation to dollar for buying and selling at 83.25 and 83.30. On the open market, the rupee rose by 5 paisa for buying at 83.05 and it gained 10 paisa for selling at 83.10, the rupee.
However, it lost 145 paisa in terms of euro for buying and selling at Rs 121.75 and Rs 122.25. In fact, the rupee is under pressure versus dollar nowadays due to importers' demand to meet their payment requirements. In the meantime, one factor appeared that its weakness may help in improving the country's big sources of earning--the textile industry. The textile industry, which is in crisis due to lack of non-availability of electricity on time, less gas supply and several other problems, may be able to show its worth.
Besides, Pakistanis overseas remitted a handsome amount of 806.12 million dollars in September, 2009 as against 660.35 million dollars in the same month of the last fiscal year (September 2008), showing a jump of 145.77 million dollars or 22.07 percent.
INTER-BANK RATES: On Monday, the rupee shed seven paisa against dollar for buying and selling at 83.30 and 83.35. On Tuesday, the rupee gained five paisa against dollar for buying and selling at 83.25 and 83.30. On Wednesday, the rupee gained 15 paisa against dollar for buying and selling at 83.10 and 83.15. On Thursday, the rupee stayed put at 83.10 against dollar for buying at 83.10 while it dropped 0 paisa for selling at 83.25.
On Friday, the rupee fell by 10 paisa versus dollar for buying at 83.20 while it remained unchanged for selling at 83.25. At the week-end, the rupee shed 5 paisa versus dollar for buying and selling at 83.25 and 83.30.
OVERSEAS OUTLOOK FOR DOLLARS: In the first Asian trade dollar fell losing ground after a G7 ministers meeting at the weekend brought no surprises, while the Australian dollar gained as speculation mounted that the country's central bank could raise rates this week. In the second Asian session dollar fell due to a newspaper report saying Gulf Arab states were in secret talks with Russia, China, Japan and France to replace the US dollar with a basket of currencies in the trading of oil.
In the third Asian trade, the dollar was on the defensive while higher-yielding currencies such as the Australian dollar held near their 2009 highs, buoyed by investors' search for returns. In the fourth Asian trading, the US dollar was on slippery ground again after stronger-than-expected Australian jobs data boosted the Australian dollar and fuelled general selling in the greenback.
In the final session of Asian trade, the dollar rose after Federal Reserve Chairman Ben Bernanke indicated monetary policy may have to be tightened as a recovery takes hold, lifting the greenback off 14-month lows against a basket of currencies. Traders said that Bernanke's remarks, although not new, prompted speculators to cover short dollar positions and lifted the US currency against the yen by more than 1 percent at one point as more market players lightened positions ahead of Japan's long weekend.
The dollar has succumbed to selling pressure in recent weeks, hurt by the market view that US interest rates are likely to remain low for some time. In the New York, the dollar rose broadly on after Federal Reserve Chairman Ben Bernanke said that the central bank will be ready to tighten monetary policy as an economic recovery takes hold.
The US dollar, which slid for much of the week, recovered some losses against the euro and pulled away from a more than 8-month low against the yen earlier in the week. Despite Friday's gains, the greenback remained lower against a basket of currencies for the week. For the coming week, it is likely that the dollar may rally ahead of the US economic data reinforcing the view that a recovery is gathering strength, making US assets attractive. The dollar has been bought and sold on rising and falling risk aversion for months but positive US economic data has sometimes prompted investors to trade on fundamentals. That happened on Friday when a US Commerce Department report showed the country's trade gap narrowed unexpectedly in August, and analysts suggest the trend will continue with strong data, including US retail sales, coming in the next week.
OPEN MARKET RATES: On October 5, the rupee failed to come out of the weak spell, losing 10 paisa for buying and selling at 83.10 and 83.20. The rupee also followed the same pattern and lost 75 paisa versus euro for buying and selling at Rs 121.05 and Rs 121.55.
On October 6, the rupee did not show any change against dollar for buying and selling at 83.10 and 83.20. Meanwhile the rupee fell 50 paisa in relation to euro for buying and selling at Rs 121.55 and Rs 122.05. On October 7, the rupee followed the same pattern and rose by 10 paisa in terms of the greenback for buying and selling at 83.00 and 83.10. The rupee, however, fell versus the euro, losing 25 paisa for buying and selling at Rs 121.80 and Rs 122.30.
On October 8, the rupee shed 10 paisa in terms of the greenback for buying and selling at 83.10 and 83.20. The rupee also lost the same amount against the euro for buying and selling at Rs 121.90 and Rs 122.40. On October 9, the rupee managed to gain 5 paisa against the dollar for buying and selling at 83.05 and 83.15. The rupee, however, shed 5 paisa against the euro for buying and selling at Rs 121.95 and Rs 122.45.
On October 10, the rupee did not show any change against the dollar for buying at 83.05 while it gained 5 paisa for selling at 83.15. The rupee managed to gain 5 paisa against the euro for buying and selling at Rs 121.75 and Rs 122.25.