Rupee edges up on exporter dollar sales

Reuters: The rupee ended slightly firmer on Friday as exporter dollar sales surpassed demand for the greenback from State banks, dealers said.

Rupee forwards were active, while spot-next forwards ended at 148.85/95 per dollar, compared with Thursday’s close of 148.90/95. “There were heavy inflows from exporters,” said a currency dealer, requesting anonymity. “The State bank (dollar) buying continued.”

On Tuesday, the Central Bank raised the spot reference rate by 20 cents to 147.50 per dollar, dealers added.

The spot rupee was hardly traded, but was quoted at 148.20/50.

Pressure on the rupee is expected to ease when seasonal inward remittances begin and importer dollar demand weakens ahead of the year-end festival season, but demand from the State banks is holding the rupee steady, dealers said.

However, a few dealers expect the rupee to be under pressure on fears that US President-elect Donald Trump’s economic policies will lead to a stronger greenback and trigger foreign fund outflows.

Foreign investors have net sold Rs. 42.1 billion worth of Government securities in the seven weeks ended 30 November, ahead of an expected Fed rate hike in December.

Stock and foreign exchange markets will remain closed on Monday and Tuesday for a holiday and will resume trading on Wednesday.