Rupee edges down on importer dollar demand

Reuters: The rupee ended slightly weaker on Monday as dollar demand from importers outpaced the selling of the US currency by banks and exporters, dealers said.

The spot rupee ended at 153.10/15 per dollar, compared with Monday’s close of 153.05/10.

“There was some importer demand and the trading was very dull,” a currency dealer said, requesting anonymity. Dealers said there was no intervention from the Central Bank.

The Central Bank is targeting a more flexible exchange rate regime, the Government said in a document outlining its policies to the International Monetary Fund.

The Central Bank has intervened in the foreign exchange market since late February only to build up reserves or to stem excessive movements in the exchange rate, and will continue to do in the future as well, the document released by the IMF showed.

The banking regulator held its policy rates steady early this month and said tightening measures are helping cool inflation and credit growth, signalling receding concerns about price pressure as it focuses on supporting an economy hit by extreme weather.