Official spot rate was unchanged at Rs 5,800, they added.
In ready business, only 1100 bales of cotton changed hands between Rs 4900-6000, they said.
Since, the current fiscal year 2011-12 started, the rupee has dropped by about seven percent versus the dollar at 92.00 because of International Monetary Fund (IMF) payments shortly, slide of the rupee could be beneficial for the exporters but under the circumstances, it was very difficult they said.
3 Similarly, Indian rupee dropped to a record low against the dollar, touched the symbolically significant level of 56, sparking mild intervention from a central bank seen by traders as reluctant to be more aggressive against such a strong down trend.
A cheaper currency of any country, helps in lifting it’s exports from the bottom, but unfortunately, presently, the whole world is under recession, which trashed out all projective and positive developments, some experts said.
The Indian rupee fell steeply versus the dollar as concerns about the euro zone prompt global risk aversion and expose India’s domestic vulnerabilities, most prominently a widening current account deficit and sluggish policy reforms.
Commenting on the decline in the Indian rupee, Naseem Usman said that some improvement seen in the exports of Indian cotton due to sharp fall in Indian rupee, but in Pakistan, cotton exporters were selling the stuff to the local mills instead of foreign buyers.
Many traders and businessmen are in grip of nervousness, as the world is still not out of risk aversion, locally the country is serious problem due to widening current account deficit, other traders said.
Additionally, reports showing that Ivory Coast has slightly lowered its cotton production forecast for the 2012/13 season to 300,000-315,000 tonnes, the executive secretary of the Ivorian ginners association said.
“If the politicians fail to make an agreement, the market will get jittery – people will look for liquidity, the dollar will rally, assets being sold and gold will come under pressure,” said Dominic Schnider, an analyst at UBS Wealth Management in Singapore.
A worsening situation in the euro zone would eventually prompt the European Central Bank to print more cash, which benefits gold as a non-yielding asset, he added.
If European leaders agreed on new effort to address the debt crisis, gold may falter as its safe haven appeal diminishes.
According to the Reuters, the NY cotton futures settled Tuesday limit down at a 2-1/4-year low on speculative liquidation, with bearish fundamentals casting a pall on fiber contracts, analysts said.
Key July cotton on the ICE Futures US exchange dropped the 3-cent daily limit to end at 71.52 cents per lb, with the session top at 78.01 cents.
New-crop December fell the same to finish at 74.57 cents, with the day’s high at 75.10 cents.
Volume on Tuesday reached almost 23,000 lots, 5 percent below the 30-day norm, Thomson Reuters data showed.
The following deals were reported, 400 bales of cotton from Bahawal pur (low quality) at Rs 4900, 100 bales of cotton from Pir Mahal at Rs 5200 and 600 bales of cotton from Rahim Yar Khan at Rs 6000, they said.