Rupee ends steady

Reuters: The rupee ended steady on Wednesday, as demand for the US dollar from importers was offset by selling of the greenback by exporters in the latter part of the day, dealers said.

The spot rupee which traded at 153.92 per dollar during the day, closed at 153.80/85, unchanged from Tuesday’s close.

“The pressure (to depreciate) is there with general importer demand and also a foreign bank buying dollars, possibly for profit repatriation,” said a currency dealer, requesting anonymity.

“With the rupee touching its all-time low of 153.92 some exporter conversions were there in the latter part of the day. We saw two State banks also selling in small quantities.”

Dealers said they expect the rupee to weaken by around 4-4.5% during the year.

The rupee has slipped 2.8% so far in the year.

The rupee came under pressure early this month due to dollar demand from State-run Ceylon Petroleum Corp (CPC), which stocked up crude oil ahead of an expected fuel price hike, dealers said.

Crude prices are expected to rise after private fuel retailer Lanka IOC said it was likely to hike rates as it has been selling at a loss, local media reported late last month.

The currency was expected to weaken on generally higher import demand ahead of the National Budget, dealers said.

The rupee has been under pressure since January after the Central Bank stopped defending the currency and started buying the dollar to build the country’s depleted foreign reserves.

The island nation has seen Rs. 19.7 billion ($128.09 million) of net inflows into equities this year as of Wednesday’s close, and Rs. 38.2 billion into Government securities as of 18 October, official data showed.