The rupee moved both ways on currency market during the week ended on September 17, 2010. On the interbank market, the rupee showed no major change against dollar for buying and selling at 85.72 and 85.75 despite higher demand for the US currency.
On the open market, the rupee failed to retain its levels versus dollar, losing 25 paisa for buying at 85.75 and five paisa for selling at 85.85. The rupee also came under pressure after falling sharply in terms of euro, dropping by Rs 3.19 for buying and selling at Rs 110.90 and Rs 111.40.
At the opening session, the markets were closed due to Eid holidays. All market reopened on Tuesday after a 4-day closure, including banks.
The rupee was supported by remittances from overseas Pakistanis, which, according to the central bank, were a record 933.06 million dollars in August. The last highest amount of remittances was 841.44 million dollars in June.
However, it is likely that the rupee would stay weaker in the medium-term because of pressure from import payments for oil and many other items.
The rupee hit a record low of 86.03 in the first week of September and lost 0.5 percent this year, after losing 6.17 percent in 2009.
INTER-BANK MARKET RATES: On Tuesday, the rupee shed 5 paisa in terms of dollar for buying and selling at 85.75 and 85.80.
On Wednesday, the rupee gave up overnight weakness, gaining 1 paisa in relation to dollar for buying at 85.74 and two paisa for selling at 85.78.
On Thursday, the rupee climbed versus dollar, gaining 3 paisa for buying at 85.71 and 2 paisa for selling at 85.76.
On Friday, the rupee shed one paisa against dollar for buying at 85.72, while it gained the same amount at 85.75.
OVERSEAS MARKET OUTLOOK: In the first Asian trade, the euro surged, as positive market sentiment following upbeat Chinese data and lack of surprises from new banking rules tripped automatic buy orders and sent it 1 percent higher against dollar. The yuan closed up after hitting a post-revaluation high against dollar, with the United States stepping up pressure on China to let the yuan rise as Treasury Secretary Timothy Geithner said he was not satisfied with the progress of yuan reform. Indian rupee was trading at Rs 46.47 and Malaysian ringgit was available at 3.1000 in terms of the US currency.
In the second Asian trade, the euro surged as positive market sentiment following upbeat Chinese data and lack of surprises from new banking rules tripped automatic buy orders and sent it 1 percent higher against the dollar.
The upbeat economic numbers out of China also propelled the Australian dollar to its highest in four months against the greenback as share markets around Asia rose on positive risk sentiment and the low-yielding yen retreated.
Interbank buy/sell rates for the taka against dollar on Tuesday: 69.5825/69.6000 (previous 69.58/69.59); Call Money Rates: 4.50-9.50 percent (previous 4.50-9.50 percent).
In the third Asian trade, the dollar jumped two yen from a 15-year low after Japan intervened to sell yen, for the first time in six years, in a move traders said would only buy it time in slowing the yen's persistent rise.
The intervention helped send the euro, Australian dollar and the sterling 2 percent higher on the day against the Japanese currency, although it was not clear whether Japan had bought anything other than dollars.
The yuan closed up against dollar on Wednesday, scoring its fastest rise in five trading days since February 2008 as US pressure mounts again over the Chinese currency's value.
The yuan rose 0.77 percent from its close of 6.7943 on Thursday lst week, after the Chinese central bank guided the yuan up as it fixed a slew of mid-points to the dollar at new highs since the yuan's landmark revaluation in July 2005.
Indian rupee was available at Rs 46.45 versus dollar and Malaysian ringgit was trading at 3.1125 in relation to the US currency.
Besides, Japan intervened in the currency market on Wednesday for the first time in six years, selling yen to stem a rise in the currency that is threatening a fragile economic recovery.
Amid fourth Asian trade, the yen crept higher but the market was on the alert for more intervention by Japanese authorities after a massive amount of yen-selling the previous day knocked the yen off a 15-year high against dollar.
Some traders saw likelihood of another round of intervention increasing if the dollar slips back below 85 yen.
Japan sold an estimated 2 trillion yen ($23 billion) on Wednesday, a record for a single day, in a move seen as aimed at showing its resolve to curb yen strength.
The yuan ended up versus dollar on Thursday, scoring its fastest rise of 1.03 percent in six trading days since January 2008, guided by the People's Bank of China's (PBOC) strong reference rates.
Indian rupee was available at Rs 46.35 versus dollar and Malaysian ringgit was trading at 3.1160 in relation to the US currency.
In the final Asian trade, the yen crept higher but the market was on the alert for more intervention by Japanese authorities after a massive amount of yen-selling the previous day knocked the yen off a 15-year high against dollar.
Malaysian ringgit was trading at 3.1125 versus dollar and Chinese yuan ended up versus dollar.
Indian rupee strengthened to touch near three-month high on firm domestic shares, raising expectations of continued foreign fund inflows, with overseas dollar weakness also supporting sentiment.
At 11 am (0530 GMT), the partially convertible rupee was at 45.96/97 per dollar, after touching 46.95, its highest since June 22 and above its 46.14/15 close on Thursday.
The dollar may fall this week as investors look to the Federal Reserve for clues about the prospect of further easing to spur the US economy, but its downside versus the yen is limited after Japan's recent massive yen sales.
Speculation that the Fed might resume large-scale asset purchases later this year pressured US Treasury yields and pushed the dollar down 1.5 percent against a basket of currencies, the biggest drop in two months.
OPEN MARKET RATES: On September 14, the rupee lost 15 paisa versus dollar for buying and selling at 85.65 and 85.75. The rupee also came under pressure in relation to euro, losing Rs 1.59 for buying and selling at Rs 109.30 and Rs 109.80.
On September 15, the rupee fell versus dollar, losing five paisa for buying and selling at 85.70 and 85.80. The rupee extended its fall against euro, losing 70 paisa for buying and selling at Rs 110.00 and Rs 110.50.
On September 16, the rupee was down versus dollar, dropping five paisa for buying and selling at 85.75 and 85.85. The rupee continued its slide against euro, losing 90 paisa more for buying and selling at Rs 110.90 and Rs 111.40.
On September 17, the market was closed after murder of Dr Imran Farooq in London on Thursday.