Rupee ends firmer on bank dollar sales

Saturday, 23 July 2016 00:06 - - {{hitsCtrl.values.hits}}

Reuters: The rupee ended firmer on Friday as dollar selling by a State-run bank surpassed late importer demand for the greenback.

One-week rupee forwards, which have been acting as a proxy for the spot rupee, traded at 145.90 intraday on dollar sales by a state bank, but ended at 146.20/40 per dollar, compared with Thursday’s close of 146.30/40.

“There was late importer demand, a State bank sold dollars,” said a currency dealer, asking not to be named.

Central Bank officials were not available for comment.

Central Bank Deputy Governor Nandalal Weerasinghe said on Wednesday that the $1.5 billion raised from a bond issue last week had already come into the country and been absorbed into its foreign currency reserves.

Last week, Finance Minister Ravi Karunanayake said the rupee would “obviously appreciate” on inflows from the country’s first sale of dual-tranche eurobonds.

The spot rupee was not traded on Friday.

Spot-next, which are rupee forwards settled three days after the spot rupee settlement, ended firmer at 146.00/20 per dollar, compared with Thursday’s close of 146.90/147.10.

The spot rupee is tightly managed by the Central Bank and market participants use the forward market levels for guidance on the currency.