Rupee 1-week forwards rise on bank dollar sales

Reuters: Rupee one-week forwards ended firmer on Thursday as a State-run bank sold dollars after the Central Bank intervened to lift the rupee, while dollar selling by a few exporters also helped the currency gain, dealers said.

One-week dollar/rupee forwards, which have been acting as a proxy for the spot rupee, ended at 146.00/30 per dollar, firmer than Wednesday’s close of 146.60/80.

“Rupee ended firmer after a State bank sold dollars. It looks like the Central Bank is trying to keep the rupee steady because it is the end of the quarter,” said a currency dealer, requesting not to be named.

Dealers said the move could help the Government show that the currency had really not depreciated during the quarter.

Officials from the Central Bank were not available for comments.

Dealers said the three-day dollar/rupee forwards, known as spot next, did not trade. It ended at 146.50/70 per dollar on Wednesday, compared with Tuesday’s close of 147.65/85.

Spot next, which has acted as a proxy for the spot currency since January, indicates the exchange rate for the day following conventional spot settlement.

For Thursday’s trade, the spot next settlement takes place five days ahead due to the intervening weekend.