The rupee: See-saw sessions at closing week of 2011

RECORDER REVIEW

KARACHI: See-saw sessions were witnessed on the money market during the last week of 2011 and the rupee moved both ways versus dollar.

In inter-bank dealings, the rupee lost 81 paisa in relation to dollar for buying at 89.93 and 82 paisa for selling at 89.96.

On open market, the rupee lost 75 paisa for buying in terms of greenback at 89.90 and 60 paisa for selling at 90.10. The rupee also rose by 37 paisa versus euro for buying and selling at Rs 115.87 and Rs 116.37.

As a result of slight increase in supply of dollars, the rupee managed to look ahead, but it seemed that higher import payment requirement may push the rupee down in the coming days. However, corrective measures may help the rupee to resist fall further. Currency swap agreement with China could recede the rising pressure over the dollar buying in the coming days.

INTER-BANK MARKET: On Monday, the rupee gave up 28 paisa versus greenback for buying at 89.40 and 30 paisa for selling at 89.44 due to surging demand of dollars.

On Tuesday, the rupee lost 40 paisa versus dollar for buying and selling at 89.80 and 89.84.

On Wednesday, the rupee lost 17 paisa versus dollar for buying at 89.97 and 16 paisa for selling at 90.00 amid persisting demand for the greenback.

On Thursday, the rupee gained three paisa against dollar for buying at 90.00 and two paisa for selling at 90.02.

On Friday, the rupee gained seven paisa against dollar for buying at 89.93 and six paisa for selling at 89.96.

OPEN MARKET RATES: On December 26, the rupee lost 35 paisa for buying in terms of US currency at 89.50 and 20 paisa for selling at 89.70. Versus euro, the rupee fell by 64 paisa for buying and selling at Rs 116.88 and Rs 117.38.

On December 27, the rupee lost 20 paisa against dollar for buying and selling at 89.70 and 89.90. Against euro, the rupee dropped by five paisa for buying and selling at Rs 116.93 and Rs 117.43.

On December 28, the rupee lost 20 paisa for buying and selling at 89.90 and 90.10. In relation to euro, the rupee lost 26 paisa for buying and selling at Rs 117.19 and Rs 117.69.

On December 29, the rupee lost 10 paisa against dollar for buying and selling at 90.00 and 90.20. Versus euro, the rupee gained Rs 1.12 for buying and selling at Rs 116.07 and Rs 116.57.

On December 30, the rupee gained 10 paisa versus dollar for buying and selling at 89.90 and 90.10. Versus euro, the rupee was trading for buying and selling at Rs 115.87 and Rs 116.37.

On December 31, the rupee retained its last levels in relation to dollar for buying and selling at 89.90 and 90.10. Versus euro, the rupee gained 20 for buying and selling at Rs 115.87 and Rs 116.37.

OVERSEAS OUTLOOK FOR DOLLAR: Reuters adds:

In the first Asian trade, euro held its ground in very thin trade, staying above an 11-month low against dollar as investors awaited an Italian debt auction later in the week.

With markets in London and New York closed for holidays, major currency pairs did not stray far from recent ranges as they entered the final trading week of 2011.

Against greenback, euro edged up to $1.3069, comfortably above an 11-month trough of $1.2945 hit this month.

Market participants said stop-loss orders around $1.3120 could push the euro higher in a thin market if triggered, while a break below $1.2945 could pave the way for a test of its 2011 low of $1.2860.

There would be no rates of some currencies as several Asian financial markets were to be closed for a holiday. Inter bank buy/sell rates for taka against dollar on Monday were 81.50-81.60 (previous 81.30-81.50) and Call Money Rates: 20.00 percent (previous 14.00-22.00 percent). Indian rupee ended stronger in thin trade as some bets on a further decline in the currency were covered amid improved risk sentiment on positive US jobs and manufacturing data. The rupee closed 0.4 percent stronger at 52.7250/7350 to dollar, from Friday's 52.9600/9675.

In second Asian trade, dollar remained caged in recent ranges against major rivals in thin trade, with euro holding above an 11-month low in the final trading days of 2011. The greenback often trades in volatile way against yen during the last three business days of the year, strategists said, but some believed that this year might be an exception.

The yuan closed slightly lower as strong dollar demand from corporates and less-than-usual year-end dollar sales offset a record high mid-point fixed by the People's Bank of China, traders said. Inter bank buy/sell rates for taka against dollar were 81.65-81.70 (previous 81.50-81.60) and Call Money Rates: 20.00 percent (previous 14.00-22.00 percent).

The dollar versus Indian rupee was available at Rs 52.71 and against Malaysian ringgit at 3.1550.

In third Asian trade, euro held above an 11-month low against dollar in Asia, with thin year-end trade set to keep the common currency subdued ahead of an Italian bond sale later in the week.

Traders expected that the embattled currency--now 12 percent below its peak hit in early May--would be mostly range-bound, though there was room for it to come under pressure after Italy's 8.5 billion euro bond sale and German CPI on Thursday.

Dollar was trading versus Indian rupee at Rs 53.02, and at 3.171 in terms of Malaysian ringgit. Yuan closed up slightly at 6.3275 against dollar, buoyed by casual dollar sales, possibly from some exporters late in the session, traders said.

In fourth Asian trade, euro hit a 10-year low against yen, pressured by selling from Japanese retail investors and exporters, with moves amplified in poor year-end liquidity.

Stop-loss selling in euro versus yen added to pressure against the single currency, which also dipped against dollar and hit its lowest level in nearly a year of $1.2887.

The euro extended its losses after sliding the previous day in thin year-end trading, and market players said the single currency is likely to stay vulnerable.

Dollar was trading versus Indian rupee at Rs 53.32, at 3.1740 in relation to Malaysian ringgit, and at 6.3242 in relation to yuan. Inter bank buy/sell rates for taka against dollar were 81.95-81.99 (previous 81.79-81.90) and Call Money Rates: 20.00 percent (previous 14.00-22.00 percent.

In final Asian trade, euro was poised to end a roller-coaster year on a downbeat note with an overnight break below crucial support levels, boding ill for the year ahead, which again looked set to be dominated by euro zone debt crisis.

Over the past year, euro lost more than 3 percent on dollar, adding to a 6.6 percent decline in 2010. On Thursday, it broke below support at this year's low and sank to a 15-month low of $1.2858. It later recovered in Asia to $1.2934.

Dollar versus Indian rupee was trading at Rs 53.07, against Malaysian ringgit at 3.1710, and at 6.3104 in terms of yuan.

At the weekend, euro capped off the most tumultuous year in its short history, slipping to a 10-year trough below 100 yen and struggling to hold gains against dollar, as trend traders expected to continue in 2012.

The euro fell 0.9 percent to 99.77 yen, and looked set to end the year down more than 8 percent against Japan's currency.