The rupee somehow, managed to resist sharp fall against dollar on high inflows of remittances during the week ended on July 23, 2011. In the interbank deals, the rupee was down 11 paisa for buying at 86.18 and 10 paisa for selling at 86.20 against dollar.
On the open market, the domestic currency rose by 10 paisa for buying at 86.00 and 20 paisa for selling at 86.10 against US currency. The rupee, however, lost Rs 1.82 in terms of euro for buying and selling at Rs 123.26 and Rs 123.76.
Slight increase in supply of dollars helped the rupee to tackle the situation boldly, resisting sharp fall. Experts feel that if textile exports' earnings continue upward trend, the rupee may be able to retain its present level, or even recover some gain, versus dollar. Rising trend in remittances was causing an upward trend in the foreign exchange reserves, which stood at 18.235 billion dollars during last week.
The Federal Bureau of Statistics (FBS) reported that the textile exports surge by 35.06 percent during the fiscal year 2010-11 as compared to the exports of 2009-10. The textile exports during July-June (2010-11) stood at 13.805 billion dollars against exports of 10.221 billion dollars during July-June (2009-10), according to FBS provisional figures.
The textile exports that contributed towards positive growth included cotton yarn, exports of which grew from 1.433 billion dollars last year to 2.184 billion dollars in 2010-11, showing an increase of 52.50 percent.
INTER-BANK DEALS: On Monday, the rupee dropped 18 paisa in terms of US currency for buying at 86.25 and 20 paisa for selling at 86.30.
On Tuesday, the rupee rose by three paisa in terms of US currency for buying at 86.22 and five paisa for selling at 86.25.
On Wednesday, the rupee inched up two paisa for buying at 86.20 against dollar and three paisa for selling at 86.22.
On Thursday, the rupee rose by eight paisa in terms of dollar for buying at 86.12 and seven paisa for selling at 86.15.
On Friday, the rupee lost two paisa versus dollar for buying at 86.14 and one paisa for selling at 86.16.
On Saturday, the rupee shed four paisa in relation to greenback for buying and selling at 86.18 and 86.20.
OVERSEAS MARKET OUTLOOK: In the first Asian trade, euro and dollar both plumbed record lows against Swiss franc on Monday, with European bank stress tests shrugged off as not tough enough and fear ruling over debt problems plaguing the European Union and United States.
The franc has been the G10 currency of choice for investors and traders seeking relative safety and liquidity from concerns that euro zone's sovereign debt crisis could become a solvency crisis, with Italian and Spanish bond yield spreads over German Bunds widening beyond 300 basis points.
The yuan ended slightly lower versus dollar after People's Bank of China set a weaker mid-point in line with a strong dollar as investors fretted about the euro debt crisis.
Indian rupee was trading at Rs 44.51 versus dollar and Malaysian ringgit was available at 3.0115.
In the second Asian trade, euro held steady, but was vulnerable to fears that Europe's debt crisis could worsen. The single currency stabilised versus dollar after having bounced off chart support near $1.4007 the previous day, and could extend that rebound, given market talk of stop-loss bids near $1.4140. But its outlook was clouded by heightened concerns that the debt crisis engulfing Greece might ensnare Italy and Spain as well.
Highlighting such worries, yields on both Italian and Spanish 10-year government bonds climbed above 6 percent on Monday, taking them closer to the 7 percent level, beyond which funding costs are perceived to be unsustainable.
The yuan ended up against dollar on Tuesday, even after the People's Bank of China set a marginally lower mid-point, as dollar index dropped in early European trade.
Indian rupee was trading at Rs 44.57 versus dollar and Malaysian rinnggit was available at 3.007. Bangladesh interbank buy/sell rates for taka against dollar were 74.52/74.59 (previous 74.52/74.53), and Call Money Rates 9.00-12.00 percent (previous 10.00-12.00 percent.
In the third Asian trade, euro eased against dollar, dogged by lingering doubts over whether a euro zone summit this week would quell investors' fears of contagion risks from Greece's sovereign debt crisis.
The yuan hit a record high against dollar after People's Bank of China set an all-time high mid-point, indicating that currency appreciation was still on the cards.
But the PBOC appeared to have slowed the pace of yuan appreciation recently amid a rise in the US Dollar Index and falls in global commodity prices. Some dealers suspected that yuan could pull back soon.
Indian rupee was trading at Rs 44.49 versus dollar and Malaysian ringgit was trading at 2.9965.
In the fourth Asian trade, euro rallied against dollar on Thursday On news that Germany and France had agreed a joint position on a debt bailout for Greece, fuelling hopes for real progress after so many false starts.
The dollar was also weighed by caution over what course the lawmakers would take in raising US debt limit as the August 2 deadline rapidly approached.
Indian rupee was trading at Rs 44.45 versus dollar, Malaysian ringgit 2.9910, and Chinese yuan was at 6.4520.
In the final Asian trade, euro rallied to a two-week high against dollar after euro-zone officials gave their financial rescue fund sweeping new powers to solve Greece's debt troubles, easing fears that the country's debt crisis would spread.
The dollar was punished across the board as the encouraging news out of Europe contrasted with confusion over how much progress Washington was making to avoid a US default.
"Europe has made a big stride, after all, while the US is still dragging its feet on the debt ceiling. That's why the dollar is under pressure now," said a dealer at a Japanese bank in Tokyo.
Markets cheered the package as it was more ambitious than some had expected earlier in the week. The euro climbed to a two-week high of $1.4440 before steadying around $1.4390.
The yuan closed at an all-time trading high against dollar on Friday after People's Bank of China fixed the currency's mid-point at a record high for the third day in a row. But yuan's strength lagged 1 percent fall in US Dollar Index overnight.
Indian rupee was trading at Rs 44.50 versus dollar and Malaysian ringgit was available at 2.980.
At the week-end, euro slipped against dollar as investors focused on how the second rescue package for Greece and measures to stop the European debt crisis from spreading would be implemented.
The euro hit a two-week high of $1.4440 on electronic trading platform EBS in early global trading but further gains were seen as limited. Analysts highlighted the risks to the deal being implemented quickly and questions over long-term debt sustainability.
"What you saw yesterday was a relief rally as the initial numbers that came out were better than expected," said John Doyle, strategist at Tempus Consulting in Washington. "Now we're looking for details on how effective the plan might actually be."
The euro was last at $1.4368, down 0.4 percent on the day after jumping nearly 1.5 percent on Thursday. Despite easing on Friday, it was on track for its first weekly gain against the dollar since the trading week ended July 1.
OPEN MARKET RATES: On July 18, the rupee did not show any change in relation to dollar for buying at 86.10 but gained 10 paisa for selling at 86.20. The rupee gained 44 paisa against euro for buying and selling at Rs 121.00 and Rs 121.50.
On July 19, the rupee recovered 10 paisa in relation to dollar for buying at 86.00 while it did not show any change for selling at 86.20. The rupee, however, lost 72 paisa in relation to euro for buying and selling at Rs 121.72 and Rs 122.22.
On July 20, the rupee lost 10 paisa in relation to dollar for buying and selling at 86.10 and 86.30. The rupee lost 54 paisa in relation to euro for buying and selling at Rs 122.26 and Rs 122.76.
On July 21, the rupee recovered 10 paisa in relation to dollar for buying and selling at 86.00 and 86.20. The rupee also recovered 86 paisa in relation to euro for buying and selling at Rs 121.40 and Rs 121.90.
On July 22, the rupee was unmoved in relation to dollar for buying and selling at 86.00 and 86.20. The rupee, however, fell steeply versus euro by Rs 2.37 for buying and selling at Rs 123.77 and Rs 124.27.
On July 23, the rupee did not move to any side against dollar for buying at 86.00 and it gained 10 paisa for selling at 86.10, while it managed to gain 51 paisa versus euro for buying and selling at Rs 123.26 and Rs 123.76.