Rupee ends steady on late remittances

Reuters:  The rupee finished steady on Wednesday as importer dollar demand in early trade was offset by late remittances in the absence of central bank intervention, dealers said.

The market, however, expects the local currency to be under downward pressure due to seasonal imports till mid-December.

The spot rupee closed steady at 146.70/75 per dollar.

“There were remittances in the afternoon and that helped ease the pressure due to importer demand,” a currency dealer said on condition of anonymity.

Another dealer said the rupee will be in the 146.50-147.00 range until the end of this year.

The rupee has been under pressure due to importer dollar demand, posting a 0.65% decline last week. Two dealers said there was neither intervention by the central bank nor direction by state banks. Usually the central bank steps into the market whenever there is volatility.

Finance Minister Ravi Karunanayake on Monday said the government wanted a strong currency through higher foreign inflows and without interventions.

The central bank has been under pressure from the International Monetary Fund (IMF) to continue rebuilding international reserves and maintain exchange rate flexibility to develop the foreign exchange market further.