THE rupee moved both ways with minor changes against the dollar in the local currency market last week. A little pick-up in dollar demand to cover imports and corporate payments amid a firm opening of domestic equities exerted downward pressure on the rupee.
However, the suspected SBP intervention through state-owned banks also kept it cheery towards the week’s closing sessions.
On the interbank market, the rupee commenced the week in minus as it continued its incessant fall against the dollar, extending weekend losses by dropping four paisas on the buying counter and three paisas on the selling counter to end at a fresh four month low at Rs104.85 and Rs104.86 against the last closing at Rs104.81 and Rs104.83.
The local currency remained depressed amid a slight pick-up in demand for US dollars
Reversing its overnight losing run, the rupee in the second trading session managed to recover five paisas on the buying counter and four paisas on the selling counter at Rs104.80 and Rs104.82 against the dollar.
In the last trading session, the rupee failed to hold firm ground versus the dollar and posted four paisas loss on the buying and three paisas on the selling counter before closing the week slightly lower at Rs104.84 and Rs104.85 against the dollar. On a week-on-week basis, the rupee suffered up to three paisas loss against the dollar on the interbank market.
In the open market, the rupee came under renewed demand pressure. It suffered the biggest single-day loss against the dollar in the past 13 weeks, losing 30 paisas at Rs105.40 and Rs105.60 against the last closing of Rs105.10 and Rs105.30.
Continuing its downward movement for the second straight day, the rupee further drifted lower by 10 paisas in the second session, hitting almost a three-and-a half month low at Rs105.50 and Rs105.70.
Chart by RA
A weakening dollar against other currencies overseas and a higher opening in the domestic stock market amid sustained dollar demand weighed on the rupee that kept the rupee firm and resulted in 10 paisas recovery against the dollar. On a week-on-week basis, however, the dollar in the open market posted 30 paisas gain against the rupee.
Against euro, the rupee last week displayed significant strength amid minor variations. It turned positive in the week’s opening session and posted 15 paisas gain in the first trading session after suffering losses in the last two consecutive sessions of the previous week. The session closed with euro trading at Rs118.10 and Rs119.10 against the prior weekend level of Rs118.25 and Rs119.25.
The rupee posted 60 paisas gain in the third trading session that sent euro to almost a seven week low at Rs117.20 and Rs118.20. After losing Rs1.05 in the first three sessions, the euro recouped 10 paisas gain against the rupee in the fourth trading session at Rs117.30 and Rs118.30. During the week in review, the rupee managed to gain 95 paisas against euro on a week-on-week basis.