Tuesday, 5 November 2013 01:24
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Reuters: The rupee fell to a three-week closing low on Monday due to year-end seasonal importer demand for dollars.
Dealers expect the local currency to edge down in the near future due to year-end importer demand for the greenback until early December.
The spot rupee closed at 131.00/10 per dollar, weaker than Friday’s close of 131.00/05, its lowest close since 15 October, Thomson Reuters data showed.
Dealers said rupee forwards were active because banks started to trade them as most of the traders were reluctant to trade the spot beyond 131.05. Traders feared that the Central Bank may warn them for breaching the level, seen as the bank’s desired level, dealers said.
Central Bank Governor Ajith Nivard Cabraal on Friday said the rupee could come under pressure due to importer dollar demand, for consumer-related goods ahead of the December festival season, but the market could manage the demand “itself without much intervention”.
The rupee hit a record low of 135.20 on 28 August, but has managed to stem further losses and is up 3.17% since then.
