Rupee firmer on bank dollar sales

Reuters: The rupee ended firmer on Friday on dollar sales by a private bank amid mild demand for the greenback from importers, dealers said.

The rupee traded at 141.25/30 per dollar, a tad firmer from Thursday’s close of 141.30/40, which was near its record low of 141.40.

Dealers said the two State banks, through which the central bank directs the market, were not seen selling dollars, but a local private bank sold dollars at 141.33 to 141.26.

“It was mainly due to export dollar sales,” said a dealer who declined to be identified.

Dealers said the rupee would continue to slide if the correct policy measures were not taken at the right time.

The rupee hit a record low of 141.40 per dollar on Monday, but recovered slightly over the past two days after a State-run bank sold dollars.

Central Bank Governor Arjuna Mahendran said on Monday the rupee was “fairly valued” and expected it to stabilise only after a rate increase by the US Federal Reserve, likely by the end of the year.

The rupee has fallen 4.6% since the Central Bank effectively floated it on 4 September.