Rupee steady amid easing depreciation pressure

Reuters: The rupee closed steady on Monday as exporter dollar conversions and worker remittances offset importer demand for greenbacks, with dealers expecting depreciation pressure to ease. The rupee closed flat at 130.00/130.10 a dollar from Friday’s close.

 It hit a record low of 131.60 on 19 March, mainly due to importer demand for greenbacks for the upcoming April festive season.

“The rupee is flat as the rate of imports has slowed down after the festival demand, and the inflows of worker remittances and exporter encashment ahead of festivals,” a currency dealer said on condition of anonymity. “The depreciation pressure has now eased.”

The rupee has fallen 12.1 per cent since the Central Bank stopped defending a specific price on 9 February.

The stock market meanwhile edged up on market heavyweight John Keells Holdings PLC, which gained 2.57 per cent in large block trades.

The main share index edged up 0.16 per cent or 8.63 points to 5,430.96, highest since 19 March.

The day’s turnover was Rs. 1.1 billion ($ 8.46 million), less than last year’s daily average of 2.3 billion. Volume was 29.7 million. Last year’s daily average was a record 102.7 million.

Foreign investors were net sellers of 2.8 million on Monday. But they have been net buyers of Rs. 20.1 billion rupees ($ 154.50 million) worth of shares so far this year, after a net outflow of 19.1 billion last year.

The Colombo Bourse is still one of the worst performers this year among Asian markets, with a 10.59 per cent loss.