Rupee’s modest recovery
IN the local currency market, the rupee/dollar parity traded both ways this week.
Demand for dollar showed modest growth in the absence of leading currency traders and lack of buying interest in the interbank dealings where the rupee remained fluctuated.
Market was closed for four days from October 26 to October 29. Trading in the local currency market resumed on October 30 after a long weekend due to Eid-ul-Azha holidays. Early closure of the market last week, however, fuelled demand pressure in the open market where market participants remain engaged in forward trading this week.
Dollar touched the high level at 96.00 versus the rupee on open market amid demand pressure.
But the rupee remained escalated against euro, moving in narrow ranges during the course of the week. Some analysts fear hectic dollar trading in next few weeks.
On the interbank market, the rupee weakness against the dollar persisted during this week.
When market resumed trade after four day closure on account of eid holidays, demand existed in the market though traders and market players were still in festival mood.
The rupee continued its declining trend as the dollar posted fresh gains against the rupee and traded at Rs95.85 and Rs95.88 in the week’s opening session after the rupee suffered five paisa loss on the buying counter and six paisa on the selling counter
over last week close of Rs95.80 and Rs95.82.
The rupee further shed five paisa against the dollar in second trading session, changing hands at Rs95.90 and Rs95.93.
It, however, rebounded against the dollar in the third trading session, recovering eight paisa at Rs95.82 and Rs95.85.
Finally in the last trading session, the rupee managed to recover modestly against the dollar as it posted seven paisa gain before closing the week at Rs95.75 and Rs95.78.
In the interbank dealings, the rupee this week gained five paisa against the dollar after some respite in dollar demand in the last trading session.
In the open market, the rupee managed to hold last weekend level in relation to the dollar which traded unchanged at Rs95.60 and Rs95.80 in the week’s opening session.
But in the second trading session, the rupee lost ten paisa and pushed dollar at Rs95.70 and Rs95.90. It further lost ten paisa for the second successive day, pushing dollar to hit Rs96 barrier in the third trading session, closing the day at Rs95.80 and Rs96.00.
However, the week ended on a happy note, as the rupee staged a modest recovery against the dollar in the last trading session, picking up ten paisa at Rs95.70 and Rs95.90. In the open market, dollar lost ten paisa against the rupee on week over week basis.
Versus European single common currency, the rupee remained fluctuated this week. It continued its weekend firmness in the week’s opening trading session as it was last changing hands at Rs122.80 and Rs123.50 after picking up 50 paisa on the buying counter and another 80 paisa on the selling counter against previous week’s Rs123.30 and Rs124.30.
In the second trading session, however, the rupee unable to retain its overnight firmness and shed lost 70 paisa on the buying counter and 100 paisa on the selling counter, trading at Rs123.50 and Rs124.50 on the day.
In the third trading session, the rupee managed to recover 30 paisa in terms of the euro which was changing hands at Rs123.20 and Rs124.20.
In the closing session however, the rupee revert back to October 30 level after shedding 30 paisa versus the euro, ending the week at Rs123.50 and Rs124.50, its lowest level in the week. During the week in review, the rupee on net basis, suffered 20 paisa loss versus the European single common currency
On the international front, the euro fell against the dollar in New York first trading session. The single currency was down 0.2 percent at $1.2915, not far from a two-week low of $1.2881, with bids from sovereign investors cited at $1.2850.
The dollar rose 0.1 percent to 79.73 yen, just off the session high of 79.75 yen but below last weekend’s four-month high of 80.36 yen. Against the dollar, sterling fell 0.5 percent to $1.6025, retreating from last week’s high of $1.6144 in London trade.
On October 30, the euro rallied against the dollar and was last up 0.4 percent at $1.2959, still close to the session peak of $1.2983.
The yen rose against the dollar after dollar hit a one-week low of 79.25 yen. It was last down 0.2 percent on the day at 79.60 yen. In London, sterling rose against the dollar and was up 0.3 percent at $1.6082, edging closer towards last week’s high of $1.6144.
On October 31, the euro posted its third straight month of gains against the dollar at $1.2959, after hitting a session peak of $1.3021, roughly a one-week high. Against the yen, the dollar was up 0.3 percent at 79.86 yen, recovering from previous day’s fall to 79.25 yen. Sterling edged up against the dollar in London, rising by 0.2 percent for a second straight day at $1.6104, having hit a session high of $1.6137 a day earlier and not far from last week’s peak of $1.6144.
On November 1, the dollar rose 0.5 percent to 80.17 yen, having hit a session peak of 80.20 and inching toward the four-month high of 80.36 struck on Reuters data last weekend.
The euro fell 0.1 percent to $1.2941, after hitting a session high of $1.2982. The common currency had earlier climbed near
$1.30. In London, Sterling rose as high as $1.6176 against the dollar, its highest level since October 17, before easing back to last trade at $1.6140.
At the close of the week on November 2, the dollar rose to a more than six-month peak against the yen, hitting a high of 80.67 yen, its highest since April 27 and last traded at 80.54 yen, up 0.5 percent.
On the week, the dollar advanced 1.1 percent versus the Japanese currency.
The dollar also rose to a three-week high versus the euro which slipped to $1.2846, its lowest since October 11. The euro last traded at $1.2847, down 0.7 percent. In London, sterling fell 0.5 percent versus the dollar to $1.6039.It had had rallied to a two-week high of $1.6176 a day earlier.