Rupee ends weaker on dollar demand from oil firm

Wednesday, 14 June 2017 00:00 - - {{hitsCtrl.values.hits}}

Reuters: The rupee ended weaker on Tuesday as a State-run bank bought dollars on behalf of a Government-owned oil company, dealers said.

Rupee forwards were active, with spot-next forwards closing at 152.90/153.00 per dollar, weaker from Monday's close of 152.85/90.

One-week forwards ended at 153.10/20, compared with Monday's close of 153.05/10.

"Today, there was some pressure (to depreciate) with some (importer) demand. There were general imports and some oil bills," a currency dealer said, requesting anonymity.

He said the State-owned bank was buying dollars to cover oil bills amid a lack of seasonal imports until late September.

The rupee has been under pressure after Central Bank Governor Indrajit Coomaraswamy said the bank would allow gradual depreciation of the currency.

The Central Bank has set a target of $ 1.2 billion in direct market purchases of dollars to boost the island nation's reserves this year.

The spot rupee did not trade on Tuesday. The Central Bank fixed the spot reference rate at 152.50 on 5 May.

Foreign investors bought a net Rs. 1.37 billion ($ 8.98 million) worth of government securities in the week ended 7 June. They have sold a net Rs. 39.96 billion worth of securities so far this year.