Local FX Market

US dollar remained stable against Bangladeshi taka last week on back of comfortable supply.

Money Market

Overnight money market was steady throughout the week. The call money rate remained unchanged throughout the week and ranged between 6.25 and 6.75 percent.

In the Treasury bill auction held on Sunday, bid for BDT 8,000.00 was accepted compared to BDT 7,500.00 last week. Weighted average yield remained unchanged for all categories of T-Bills.

International FX Market

The yen extended losses on Friday on growing doubts that finance officials at the Group of Seven meeting in Germany this weekend would take any action to stem the Japanese currency's decline. The yen fell against the euro for the fourth straight day and against the US dollar for the third session in a row. At the beginning of the week, the yen hit a record low against the euro on Monday as investors re-entered short positions after Group of Seven officials meeting over the weekend spoke out only indirectly against the Japanese currencies weakness. RBC forecast that the euro will rise towards 165 yen in three to six months' time. The euro was up 0.13 percent against the yen after hitting record high earlier. The dollar was up 0.15 percent against the yen, off an earlier session high, just 10 ticks short of a 4 year peak.

In the middle of the week, the euro rose against the dollar on Tuesday after strong German and French fourth quarter growth data, as investors awaited further European data and a key German sentiment survey for more clues on the monetary policy outlook. The yen bounced from Monday's record low against the euro and rose against the US dollar as investors booked profits on broader yen selling after last weekend's G7 meeting ahead of Japanese GDP data on Thursday and Bank of Japan's policy meeting next week. The euro was up 0.4 percent on the day, having risen to its highest since early January. The euro was up 0.3 percent against the yen, inching closer to Monday's record high of 159.00.

At the end of the week, the yen hit a one-month high against a broadly softer dollar on Thursday after Japanese fourth quarter growth data came in surprisingly strong, reviving talk of a Bank of Japan rate hike next week. The dollar continued losing ground, hitting a fresh six-week low against the euro, after comments on Wednesday from US Federal Reserve Chairman Ben Bernanke rekindled debate about the prospect of a US rate cut. Japan's economy expanded at an annualised 4.8 percent in the October-December quarter, beating market expectations for growth of 3.8 percent, thanks to a recovery in personal consumption. The dollar was down 0.4 percent on the day, having hit a low last seen on Jan. 11. The euro fell against the yen, retreating from a record peak of 159 yen scaled on Monday. The euro was steady against the dollar, after hitting a six-week high earlier.

- Standard Chartered Bank