THE RUPEE: bears dominate


The rupee drifted lower against the dollar on the currency market during the week, ended on May 24, 2014. In the interbank market, the rupee lost 17 paisa in terms of the dollar for buying and selling at Rs 98.84 and Rs 98.86.

In the open market, the rupee fell by 40 paisa in terms of the dollar for buying at Rs 99.65 and it also lost 35 paisa for selling at 98.86, the rupee however, gained 25 paisa versus the euro for buying and selling at Rs 135.75 and Rs 136.00.

Commenting on the stability of rupee in terms of dollar, analysts said that visible increase in the country’s foreign exchange reserves to 13.132 billion dollar, helped in the improvement of dollars’ supply, which caused firmness in the rupee value.

On the other hand, current account deficit rose during the same period as the country is depending on import of goods but the exports are not showing significant improvement.

In the meantime, to make easy supply of dollar, the State Bank of Pakistan injected Rs 414 billion into the banking system to save the banks from the liquidity cruench.

INTER-BANK MARKET RATE: On Monday, the rupee gave up overnight gains in terms of the dollar, losing 13 paisa for buying and selling at Rs 98.67 and Rs 98.69. On Tuesday, the rupee drifted lower against the dollar, shedding 13 paisa for buying 98.80 and it also lost 10 paisa for selling at Rs 98.85.

On Wednesday, the rupee extended overnight slide versus the dollar, losing five paisa for buying at Rs 98.85 and the national currency also shed two paisa for selling at Rs 98.87.

On Thursday, the rupee sustained its overnight level for buying at Rs 98.85 while it inched down by three paisa for selling at Rs 98.90. On Friday, the rupee inched up by one paisa versus the dollar for buying at Rs 98.84 while it shed four paisa for selling at Rs 98.86.

OPEN MARKET RATES: On May 19, the rupee also back in familiar territory against the dollar due pressure of the greenback, shedding five paisa versus the dollar for buying and selling at Rs 99.25 and Rs 99.45. While, the rupee sustained its week-end levels in terms of the euro for buying and selling at Rs 136.00 and Rs 136.25.

On May 20, the rupee also adopted the same path versus the dollar, falling 10 paisa for buying at Rs 99.35 and it fell by five paisa for selling at Rs 99.50. While, the national currency managed to hold its last levels in terms of the euro for buying and selling at Rs 136.00 and Rs 136.25.

On May 21, the rupee, in sympathy with the interbank market track, the national currency lost 15 paisa for buying at Rs 99.50 and it fell by 20 paisa for selling at Rs 99.70. While, the rupee lost 25 in terms of the euro for buying and selling at Rs 136.25 and Rs 136.50.

On May 22, the rupee traded in a negative territory in relation to the dollar, falling 15 paisa for buying and selling at Rs 99.65 and Rs 99.85. While, the rupee gained 25 in terms of the euro for buying and selling at Rs 136.00 and Rs 136.25.

On May 23, the rupee was down by five paisa in relation to the dollar for buying at 99.70 while it did not move any side for selling at Rs 99.85. While, the rupee lost 50 in terms of the euro for buying and selling at Rs 136.50 and Rs 136.75.

OPEN MARKET RATES: The rupee shrugged of overnight weakness against the dollar, gaining five paisa for buying and selling at 99.65 and Rs 99.8, dealers said. While, the rupee appreciated by 75 paiss in terms of the euro for buying and selling at Rs 135.75 and Rs 136.00, they said.

OVERSEAS OUTLOOK FOR DOLLAR: In the first Asian trade, the euro edged up slightly versus the dollar after two punishing weeks as investors waited for fresh data, with its upside pressured by growing expectations of easier policy in the euro zone.

The euro added about 0.1 percent to $1.3702, nursing losses of over 1 percent suffered in the past two weeks and moving away from a nadir of $1.3648 touched on Thursday.

The dollar was trading against the Indian rupee at Rs 58.46, the greenback was at 3.2105 in terms of the Malaysian ringgit and the US currency at 6.2374 versus the Chinese yuan. Inter bank buy/sell rates for the taka against the dollar on Monday. 77.63-77.64 (77.64-77.64). Call Money Rates: 05.75-07.25 percent (previous 05.50-07.25 percent).

In the second Asian trade, the yen held near a 3 1/2-month high against the dollar and the euro on Tuesday, supported by diminishing expectations of stimulus by the Bank of Japan as well as falling US and European bond yields. The dollar traded at 101.54 yen, a day after falling to 101.10 yen, its lowest level since early February-briefly breaking below its 200-day moving average at 101.25 yen.

The dollar was trading against the Indian rupee at Rs 58.64, the greenback was at 3.2130 in terms of the Malaysian ringgit and the US currency was available at 6.2378 versus the Chinese yuan. Inter bank buy/sell rates for the taka against the dollar on Tuesday. 77.6300-77.6325 (77.63-77.64). Call Money Rates: 05.70-07.25 percent (previous 05.50-07.25 percent).

In the third Asian trade, lower US Treasury yields held the dollar near a 3-1/2 month low against the yen early on Wednesday, with markets looking for potential catalysts from the Bank of Japan’s policy review later in the day.

The dollar dipped 0.1 percent to 101.25 yen, within striking distance of 101.10 hit on Monday, its lowest since February 5. The dollar has shed roughly 1 percent against the yen so far this month, nudged lower by a steady decline in US yields.

The dollar was at Rs 58.74 versus the Indian rupee, the greenback was available at 3.2195 in terms of the Malaysian ringgit and the US currency was at 6.2390 in relation to the Chinese yuan.

In the fourth Asian trade, the he yen eased versus the dollar on Thursday and edged away from a 3-1/2-month high, as a survey showing an improvement in Chinese factory activity helped bolster risk appetite and dampened demand for the safe haven currency.

The dollar rose 0.3 percent to 101.63 yen, well off a 3-1/2-month low near 100.80 yen plumbed on Wednesday. The euro edged up 0.2 percent to 138.95 yen, up from a 3-1/2- month trough of 138.15 yen also set on Wednesday.

The dollar was trading against the Indian rupee at Rs 58.60, the greenback was at 3.2065 in terms of the Malaysian ringgit and the US currency was at 6.2341 versus the Chinese yuan.

Inter bank buy/sell rates for the taka against the dollar on Thursday. 77.63-77.63 (77.63-77.63). Call Money Rates: 05.75-07.25 percent (previous 05.75-07.25 percent).

In the final Asian trade, the dollar steadied near one-week highs against the yen and advanced on the euro after promising US housing and factory activity data nudged US Treasury yields away from recent lows.

The dollar index, which tracks the greenback against a basket of rivals, edged up to 80.264.

The dollar was trading against the Indian rupee at Rs 58.45, the greenback was at 3.2100 in terms of the Malaysian ringgit and the US currency was available at 6.236 versus the Chinese yuan.

At the weekend, the euro fell to a three-month low against the dollar and a 17-month trough against the pound on Friday after a disappointing report on German business sentiment supported the view the European Central Bank will cut interest rates next month.

Concerns that Sunday’s European Union election results could destabilise some euro zone governments also weighed on the euro. Germany’s leading indicator of business confidence, the Ifo index, pointed to slower growth in Europe’s largest economy as the index hit its lowest level this year in May.

Recorder Report

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