The rupee was lower against dollar, it however, showed an upward trend versus euro in the money market during the week, ended on March 3, 2012. In the interbank market dealings, the rupee inched down in terms of the US currency, shedding two paisa for buying at 90.98 and it also fell by three paisa for selling to Rs 91.01.
On the open market the rupee ended with 15 paisa decline against dollar for buying and selling at 91.05 and 91.25. It, however, gained in relation to the single European currency, picking up 95 paisa for buying at Rs 120.40 and rose by 45 paisa for selling at Rs 121.40.
As a result of higher oil prices in the international market, the payments became costlier, which caused increase in dollar value.
Poor law and order situation in the country is causing sharp decline in the foreign investment with the passage of time. One of the basic sources of easy supply of dollars is foreign investment, which almost dried up as some years ago, the country was receiving around 4-5 billion dollars per year but presently, the foreign investment came down to nearly 100 million dollars per year. The concerned authorities must take the said issue seriously because trade gap is also widening day by day due to so much dependence on imports, on the other hand, the exports are on falling, so the foreign exchange reserves are on decline. Payments of loans to the foreign countries are also another adding factors and creating short supply of dollars. Thanks to the remittances which helped the rupee to resist sharp fall versus dollar.
According to the State Bank of Pakistan (SBP) country's foreign exchange reserves fell to 16.42 billion dollars in the week ended on February 24 because of repayment of an International Monetary Fund (IMF) loan.
INTER-BANK MARKET RATES: On Monday, the rupee lost 12 paisa in terms of the dollar for buying and selling at 90.96 and 90.98. On Tuesday, the rupee inched down by one paisa versus dollar for buying and selling at 90.97 and 90.99. On Wednesday, the rupee was up by one paisa versus dollar for buying and selling at 90.96 and 90.98. On Thursday, the rupee inched up by one paisa versus dollar for buying at Rs 90.95 while it retained the overnight level for selling at 90.98. On Friday, the rupee fell in terms of dollar, losing three paisa for buying and selling at Rs 90.98 and at 91.01.
OPEN MARKET RATES: On February 27, the rupee extended its decline against dollar, losing five paisa for buying and selling at 90.90 and 91.10. In relation to euro the rupee managed to gain 44 paisa for buying and selling at Rs 121.35 and Rs 121.85. On February 28, the rupee did not move any side against dollar for buying and selling at 90.90 and 91.10. In relation to euro, the rupee gave up 26 paisa for buying and selling at Rs 121.61 and Rs 122.11. On February 29, the rupee retained overnight levels against dollar for buying and selling at 90.90 and 91.10. In relation to euro the rupee shed five paisa for buying and selling at Rs 121.66 and Rs 122.16. On March 1st the rupee shed five paisa against dollar for buying and selling at 90.95 and 91.15. In relation to euro the rupee gained 46 paisa for buying at Rs 121.20 and it, however, lost four paisa for selling at Rs 122.20. On March 2, the rupee continued slide against dollar, shedding five paisa more against for buying and selling at 91.00 and 91.20. In relation to euro, the rupee, however, gained 80 paisa for buying and selling at Rs 120.40 and Rs 121.40.On March 3, the rupee drifted lower against dollar, shedding five paisa more for buying and selling at 91.05 and 91.25. In relation to euro the rupee retained overnight levels for buying and selling at Rs 120.40 and Rs 121.40.
OVERSEAS OUTLOOK FOR DOLLAR: In the first Asian trade yen slid to a nine-month low against dollar as the break of a key chart level triggered stop-loss selling, while euro held firm ahead of a fresh injection of liquidity by the European Central Bank. The Chinese yuan ended down slightly against dollar after the People's Bank of China set a weaker midpoint, even though the dollar index hit a nearly three-month low, underscoring the central bank's resolve to restrain sharp gains in yuan. Spot yuan closed at 6.3019 against dollar, edging down from Friday's close of 6.2978. The dollar was trading against the Indian rupee at Rs 49.06 and the greenback was at 3.0200 versus the Malaysian ringgit.
During the second Asian trade yen pulled away from a 9-month low plumbed the day before on month-end buying by Tokyo exporters, although short-covering by hedge funds forced it to relinquish some early gains. A record trade deficit, shrinking current account surplus and surprise policy easing by the Bank of Japan have combined to trigger what is set to be - despite an apparent correction kicking in - yen's sharpest monthly drop in more than two years. The dollar versus the Indian rupee was trading t Rs 49.12, the greenback was available versus the Malaysian ringgit at 3.0090 and the Chinese yuan was at 6.3007 per unit. Inter bank buy/sell rates for the taka against dollar on Tuesday: 81.70-81.82 (previous *81.60-81.80) Call Money Rates: 07.00-16.00 percent (previous *08.00-18.00 percent).
In third Asian trade euro held its ground ahead of a fresh cash injection by the European Central Bank (ECB). The euro and commodity currencies held steady in early trade with the former within easy reach of a 2-1/2 month peak of $1.3486 hit last Friday and on track to end the month up three percent, its best performance since October. The Indian rupee was knocked off its three-week high in afternoon trading on Wednesday as local stocks reversed early gains, but expectations of strong capital inflows limited the currency's fall. At 2:40 pm, the rupee was at 48.98/99 to dollar, down from 48.83 - its highest since February 7, according to Thomson Reuters data. It had settled at 49.0750/0850 on Tuesday.
In fourth Asian trade, the US dollar hovered above a three-month low against a basket of major currencies after the US Federal Reserve chief stopped short of offering a clear hint of more bond buying.
Inter bank buy/sell rates for taka against dollar on Thursday: 81.70-81.85 (previous 81.70-81.85) Call Money Rates: 10.50-12.00 percent (previous 08.00-13.00 percent).
The yuan ended down against dollar on Thursday after the People's Bank of China fixed its midpoint 97 pips lower from the previous day, mainly because of a jump in the dollar index. Spot yuan ended at 6.3002 against dollar, lower than Wednesday's close of 6.2936. The Indian rupee started the final month of the fiscal year on a weak note on Thursday as a lack of interest by foreign investors in the government's sale of shares in Oil and Natural Gas Corp dampened expectations of a pickup in capital inflows. The Indian rupee snapped a 2-day rise to close at 49.21/22 to dollar, down from Wednesday's close of 49.0050/0150, after moving in a band of 49.045-49.245.
In final Asian trade yen slipped broadly and neared a recent nine-month low versus dollar, retreating due to yen-selling by Japanese importers and as traders took aim at stop-loss levels. The dollar rose 0.4 percent against yen to 81.44 yen, nearing a nine-month high of 81.661 yen hit earlier this week on trading platform EBS. The dollar was available versus the Indian rupee at Rs 49.46, it was at 3.0015 versus the Malaysian ringgit and the US currency in relation to the Chinese yuan was at 6.2976.
At the weekend euro dropped against dollar for a third straight day and was on track for its worst week since mid-December after debt-burdened Spain challenged the European Union's new fiscal pact.