Rupee edges down on importer dollar demand

Reuters: The rupee ended slightly lower on Wednesday as dollar demand from importers surpassed selling of the US currency by exporters, dealers said.

Rupee forwards were active, with spot-next forwards ending at 152.95/153.05 per dollar, weaker compared with Tuesday’s close of 152.90/153.00.

One-week forwards ended at 153.15/25, compared with Tuesday’s close of 153.10/20.

“The rupee is under pressure with importer demand,” a currency dealer said, requesting anonymity. Seasonal demand for dollars will start from August, the dealer added. The rupee has been under pressure after Central Bank Governor Dr. Indrajit Coomaraswamy said the bank would allow gradual depreciation of the currency. The Central Bank has set a target of $1.2 billion in direct market purchases of dollars to boost the island nation’s reserves this year. The spot rupee did not trade on Wednesday. The Central Bank fixed the spot reference rate at 152.50 on 5 May. Foreign investors bought a net Rs. 1.37 billion ($8.98 million) worth of Government securities in the week ended 7 June. They have sold a net Rs. 39.96 billion worth of securities so far this year.