Rupee ends weaker on importer dollar demand

Wednesday, 25 September 2013 00:20 - - {{hitsCtrl.values.hits}}

Reuters: The rupee slipped on Tuesday due to mild importer dollar demand, but traders said inflows from a recent offshore bond sale by a State bank contained the downside. The rupee spot ended at 132.18/22 compared with Monday’s close of 132.05/10. “The rupee is weaker on mild importer dollar demand but we expect the rupee to stay at these levels in the short term,” a dealer said. Many dealers expect the rupee to hold steady around the 132.25 level due to inflows from the National Savings Bank’s $750 million five-year bond issue. However, dealers say the currency could falter in the medium term, noting the recent pressure caused by the absence of steady dollar inflows from exports and remittances from overseas workers. The currency hit a record low of 135.20 on 28 August, but has managed to stem further losses since then. It has fallen 3.6% this year, after depreciating about 10% in 2012. The rupee has fallen 4.5% since early July when foreign investors started pulling out of local bonds as US Treasury yields rose in anticipation of the US Federal Reserve trimming its stimulus.

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