Local currency market was closed for three days from September 21 to 23 on account of Eid-ul-Fitr celebrations.When the market opened on September 24 it was still in festival mood. The rupee-dollar parity rates moved both ways amid higher demand for greenback. On the inter-bank market the rupee posted fresh gain of five paisa against the dollar which traded at Rs82.95 and Rs83. after closing the previous week at Rs83 and Rs83.05.
The rupee did not show any change against the dollar on the last trading day of the week in review as the dollar continued to trade at its overnight level on September 25. However, the dollar in the inter-bank market has gained Rs4.80 in relation to rupee in the past 12 months. The parity was changing hands at Rs78.15 and Rs78.20 September 26 last year.
In the open market, the rupee commenced the week on negative note amid hectic buying of dollar as market reopened after celebrating Eid. Due to higher demand for dollar, the rupee came under pressure and shed 15 paisa against dollar, changing hands at Rs82.85 and Rs82.95. The rupee had closed previous week at Rs82.70 and Rs82.80.
On September 25, there was no gap in the inter-bank and open market rates of dollar as it was trading at Rs82.90 and Rs83.00 after the rupee shed five paisa versus dollar on the last trading day of the week in review.
This week, the rupee in the open market lost 20 paisa against the dollar due to rise in dollar demand in the last trading session. Over the past 12 months however, the rupee in the open market has lost Rs4.70 against the dollar on the buying counter and another Rs4.40 on the selling counter. The dollar was trading in the open market at Rs78.20 and Rs78.60 on September 26 last year.
Versus the European single common currency, the rupee opened the week on dismal note, losing 65 paisa to trade at Rs121.30 and Rs121.80 on September 24 after closing at Rs120.65 and Rs121.15 in the previous week. The rupee, however, managed to gain 38 paisa versus euro on the buying counter and another 40 paisa on the selling counter September 25 when it was changing hands at Rs120.92 and Rs121.40 following persistent rise in the international market. During the week in review, the rupee managed to gain 27 paisa against euro on the buying counter and 25 paisa on the selling counter. However, it has lost Rs7.32 on the buying counter and Rs7.70 on the selling counter in the past 12 months when euro was trading at Rs113.60 and Rs113.70.
On the international front, the dollar climbed broadly on the opening day of the week, hitting a near two-week high against the yen in New York as investors reduced bets against the greenback ahead of a monetary policy meeting by the Federal Reserve this week. The dollar rose more than one per cent against the yen after speculative flows pushed it higher, though the gains were subsequently pared. Trading in Asia was quiet as financial markets in several major markets were closed for local holidays.
In late New York trading, the euro slipped 0.2 per cent to $1.4672, easing from $1.4766 hit late last week, which was its strongest since September 2008, according to Reuters data. Against the yen, the dollar was up 0.8 per cent at 92.04 yen, near a peak of about 92.53 yen, its highest since Sept. 9. Against the dollar sterling was down 0.6 per cent at $1.6175, near $1.6134 hit earlier in the day for its weakest level in nearly three weeks.
On September 22, the dollar dropped broadly hitting a one-year low against the euro as optimism about a global economic recovery dented safe-haven demand ahead of a Federal Reserve meeting and Group of 20 summit this week. Traders took advantage of a dollar rally in the prior session to sell on views the Federal Open Market Committee will signal plans to maintain loose monetary policy well into 2010 to promote the recovery.
In late trading, the euro was up 0.8 percent at $1.4796 after options-related demand and strong Asian buying pushed it above $1.48 for the first time since September 2008. With no major economic data on the calendar, traders said $1.4825 may be the next target in euro-dollar, with many predicting an eventual move back to $1.50. The dollar fell 0.9 per cent to 91.14 yen and 0.8 per cent to 1.0231 Swiss francs, near a 14-month low touched earlier. Sterling rose 1 percent to $1.6359. The euro rallied to a year-high against the dollar, rising as high as $1.4821.
On September 23, the dollar rebounded from a one-year low against the euro as US stocks reversed gains sparked by an optimistic statement from the Federal Reserve on the economic outlook. The dollar had earlier sold off after the Fed said US economic activity had picked up after a severe downturn and renewed its pledge to keep rates exceptionally low for an extended period to support the recovery.
The euro rose as high as $1.4842, according to Reuters data, its highest level since September 2008. It last traded down 0.4 per cent at $1.4728. The dollar rose 0.2 per cent to 91.34 yen. Sterling rallied more than half a percent on the day to a session high of $1.6456, having jumped a full cent soon after the minutes were released. It traded at $1.6402, up 0.3 per cent on the day.
On September 24, the euro was down 0.5 per cent at $1.4650, off a session high of $1.4803 and a one-year peak of $1.4842 hit a day ago. The dollar was little changed at 91.23 yen, though that was well off a 90.36 session low. The euro was risen five per cent against the dollar this year. Sterling fell 1.8 per cent to $1.6049, dropping below $1.61 for the first time since July.
At the close of the week on September 25, the euro edged up 0.2 per cent to $1.4690 after falling as low as $1.4614 earlier in the day. The dollar fell 0.8 percent against the yen to 90.57 yen as the Japanese currency rose broadly, helped partly by its sharp gains versus the pound. Sterling slid further to a four-month low against the dollar as a break of major support levels triggered a wave of stop-loss sales. The pound extended its slide, falling below major support at $1.60. It dropped as low as $1.5917, its lowest since early June, before edging back to $1.5989, down 0.4 per cent on the day.
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