Rupee rises on slow dollar demand

LAHORE: The rupee traded firm against the dollar in the local currency market, moving in narrow band last week. Though demand for dollar existed, sustained selling of dollars by banks and exporters in view of good foreign capital inflows was sufficient to cover demand. Due to a relatively lesser than usual demand from the corporate sector, no sizeable payments from national exchequer took place during the week. At the same time, banks had enough liquidity to meet import payments requirement. Against euro, however, the rupee escalated both ways in narrow ranges. On the interbank market, the rupee last week displayed strength against the dollar amid low demand. The rupee further extended its weekend firmness against the dollar in the first trading session when it traded at Rs104.73 and Rs104.75 over the last closing at Rs104.76 and Rs104.77. In the second session it inched down by one paisa on the buying counter but retained its overnight rate unchanged on the selling counter.

The local currency staged a modest recovery at Rs104.73 and Rs104.74. Continuing its upward march, the rupee traded at Rs104.71 and Rs104.72 in the fourth session. It ended the week on plus note, hitting fresh highs at Rs104.66 and Rs104.68.

During the week, the dollar in the interbank market depreciated against the rupee by 10 paisas on the buying counter and 11paisas on the selling counter.

In the open market, the rupee opened week by posting 10 paisas gain against dollar at Rs105.80 and Rs106.00 against the prior weekend level of Rs105.90 and Rs106.10. The dollar weakened by another 20 paisa to close at Rs105.60 and Rs105.80, hitting fresh lows against the rupee on sustained selling of dollars by banks and exporters in the second trading session. After gaining 30 paisas in the first two trading sessions, the rupee traded flat at Rs105.60 and Rs105.80 in the following three straight sessions amid lower than usual dollar demand and easy dollar supplies. During the week, the rupee in the open market appreciated against the dollar by 30 paisas on a weekon-week basis. Against euro, the rupee escalated between plus and minus, moving in narrow band. The week commenced in plus as the rupee extended weekend firmness and posted 30 paisas gain in the first trading session.