Rupee recovers from near 3-month low on exporter dollar sales, remittances

Saturday, 1 March 2014 06:41 -     - {{hitsCtrl.values.hits}}

Reuters: The rupee recovered on Friday from a near three-month closing low in the previous session, rising to a more than one-week high due to exporter dollar conversions and inward remittances, dealers said. The spot rupee ended at 130.55/60 per dollar, 0.33% firmer from Wednesday’s close of 131.05/10, its lowest since Dec. 3. Both the stock and currency markets were closed on Thursday for a religious holiday. The currency has been hovering around three-month lows in the last four sessions through Wednesday as importer dollar demand and equity outflows were offset by dollar sales by State banks, dealers said. The market, however, expects downward pressure to continue ahead of festival import demand in April, dealers said. They expect the rupee to gradually depreciate to 131.60 by the end of the first quarter due to seasonal imports. However, the depreciation is expected to be mild as the Central Bank has the muscle to defend the rupee due to strong reserves. Foreign investors bought a net Rs. 709 million worth of Government securities in the week ended 26 February after being net sellers for the past two weeks. They net sold Rs. 5.43 billion in stocks in 15 straight sessions through Friday. The rupee has gained about 3.54% since it hit a record low of 135.20 on 28 August last year. It lost 2.5% in 2013.