The rupee was firm against dollar on the currency market during the week, ended on April 23, 2011. On the interbank market, the rupee gained six paisa in relation to the US currency for buying at 84.27 and eight paisa for selling at 84.30.
On the open market, the rupee picked up 10 paisa versus dollar for buying and selling at 84.30 and 84.50. However, it lost Rs 1.16 versus euro for buying and selling at Rs 122.15 and Rs 122.65.
Rising inflows supported the rupee to retain its firmness and it is most likely that it may recover more ground in the coming days.
According to the State Bank of Pakistan (SBP), the country's foreign exchange reserves rose to $17.38 billion dollars in the week ending on April 16, from 17.31 billion dollars of previous week.
INTER-BANK MARKET RATES: On Monday, the rupee rose by nine paisa in relation to dollar for buying 84.24 and 10 paisa for selling at 84.28.
On Tuesday, the rupee lost 28 paisa versus dollar for buying at 84.52 and 30 paisa for selling at 84.58.
On Wednesday, the rupee gained 11 paisa versus dollar for buying at 84.41 and 12 paisa for selling at 84.46.
On Thursday, the rupee gained six paisa in relation to dollar for buying and selling at 84.35 and 84.40.
On Friday, the rupee gained 11 paisa in terms of dollar for buying at 84.24 and 12 paisa for selling at 84.28.
At the weekend, the rupee shed three paisa versus dollar for buying 84.27 and two paisa for selling at 84.30.
OVERSEAS OUTLOOK FOR DOLLAR: In the first Asian trade, the euro extended losses after repeated attempts to break above a resistance level failed, placing focus on renewed worries about euro zone debt problems and giving dollar a much needed reprieve after heavy selling in the past few weeks.
The euro fell 0.4 percent to $1.4377 after another try at rising clearly above $1.45 failed on Friday and as markets grew uneasy after Finnish voters handed the anti-euro 'True Finns' party a crucial role in parliament, and possibly into government.
The euro hit its lowest in more than two weeks against yen at 118.94 yen on trading platform EBS and was last down 0.7 percent at 119.14 yen, its drop having gained steam after triggering stop-loss selling.
In the second Asian trade, the yen edged higher in Asia as more market players cut back on carry trades, but the move was likely be short-lived as hedge funds and Japanese life insurers positioned for the yen to resume its slide before long.
Risky assets were hit by a double-whammy on Monday after fears mounted that Greece will have to restructure its mountain of debt, possibly as early as this summer, and Standard & Poor's threatened to cut the United States' prized AAA credit rating.
The drop in Wall Street shares spilled across Asia, with Japan's Nikkei average and Hong Kong's Hang Seng both shedding about 1 percent as investors booked profits and closed positions heading into the Easter holidays later in the week.
Indian rupee was at Rs 44.45 against US currency, Malaysian ringgit at 3.0300, and Chinese yuan was trading at 6.5323. Interbank buy/sell rates for taka against dollar were 72.78/72.86 (previous 72.79/72.88); call money rates: 6.00-12.00 percent (previous 6.00-12.00 percent).
In the third Asian trade, euro and commodity currencies such as Australian dollar rebounded, as investors bought them again after a mild shake-out of stretched long positions at the start of the week.
Gains in US and European shares on upbeat corporate results helped soothe market sentiment after nerves were rattled on Monday by S&P's warning on US credit ratings and on fears that Greece would have to restructure its debt.
While those problems remain unresolved, the moves showed investors continuing to favour higher-yielding currencies at the expense of dollar and yen, and a rise in Asian equities underscored a rebound in risk-taking sentiment.
"The fact that there was little emotional reaction after the S&P move perhaps helped to improve investors' sentiment towards risk," said Makoto Noji, senior strategist at SMBC Nikko Securities in Tokyo.
Interbank buy/sell rates for taka against the dollar were 72.75/72.83 (previous 72.78/72.86); and Call money rates: 6.00-12.00 percent (previous 6.00-12.00 percent). Indian rupee was trading at Rs 44.48 versus the dollar, Malaysian ringgit was at 3.0170 against the greenback and Chinese yuan was trading at 6.5264 in relation to the US currency.
In the fourth Asian trade, dollar tumbled to a three-year low against a basket of currencies on Thursday, with market players selling the greenback to buy buoyant risky assets in a move that threatens to drive the dollar index towards its historic low. The dollar had taken a hit in the past few days as investors flocked back to higher-yielding currencies, commodities and equities after a brief shake-out earlier in the week.
Indian rupee was trading at Rs 44.32 versus dollar, Malaysian ringgit at 3.0080 and Chinese yuan was at 6.5187.
Interbank buy/sell rates for taka against dollar were 72.73/72.88 (previous 72.75/72.83), and Call Money Rates: 6.00-12.00 percent (previous 6.00-12.00 percent).
In the final market, dollar hovered near a three-year low against a basket of currencies, undermined by the spectre of low US interest rates and the crushing weight of the US budget deficit, with some players looking for it to test an all-time low when players return from the Easter holidays.
The dollar index slipped to a three-year low of 73.735 on Thursday, having slipped below its 2009 trough of 74.170. It last stood at 74.061 on Friday, about 4.7 percent above its record low of 70.698 marked in March 2008.
Trade was thin as many markets were shut for Easter. But some participants said the greenback's downtrend looked set to resume once players come back from the holidays.
"The market was generally positive on risk, with 'VIX' (market volatility index) falling to a new low since the Lehman shock, so that's helping to push down the dollar," said Koji Fukaya, chief strategist at Credit Suisse.
All commercial centres were closed in New York on Friday due to good Friday. In the meantime, according to an analysis, for years, US Treasury secretaries parroted a line that America was committed to a strong dollar policy. But as the greenback slid close to all-time lows, President Barack Obama's administration was noticeably quiet.
Treasury Secretary Tim Geithner last used "strong dollar" language in November, and a glance through his speeches and news databases showed that he had almost nothing to say on the matter since.
OPEN MARKET RATES: On April 18, the rupee retained its overnight level versus dollar for buying at 84.40 while it gained five paisa for selling at 84.55. The rupee rose by 56 paisa versus euro for buying and selling at Rs 120.43 and Rs 120.93.
On April 19, the rupee shed five paisa against dollar for buying and selling at 84.45 and 84.60. The rupee gained 38 paisa versus euro for buying and selling at Rs 120.05 and Rs 120.55.
On April 20, the rupee recovered five paisa in terms of dollar for buying at 84.40 and retained its selling rate at 84.60. The rupee, however, lost Rs 1.25 for buying at Rs 121.80 and Rs 1.75 for selling at Rs 122.30 versus the euro.
On April 21, the rupee did not show any change against dollar for buying at 84.40 while it gained 10 paisa for selling at 84.50. The rupee, however, lost Rs 1.07 against euro at Rs 122.87 and 123.37 for buying and selling.
On April 22, the rupee rose by five paisa versus dollar for buying at 84.35 while it was unchanged for selling at 84.50. The rupee resisted its slide in terms of euro and gained 52 paisa for buying and selling at Rs 122.35 and Rs 122.85.
On April 23, the rupee gained five paisa versus dollar for buying at 84.30 while it was unchanged for selling at 84.50. The rupee recovered 20 paisa in terms of euro 20 paisa for buying and selling at Rs 122.15 and Rs 122.65.