Rupee recovers from record low on exporter dollar sales

Wednesday, 13 June 2018 00:01 - - {{hitsCtrl.values.hits}}

Reuters: The rupee ended firmer on Tuesday, recovering from an all-time low hit in the previous session, as late exporter dollar sales surpassed mild importer demand for the greenback, dealers said.

The spot rupee, which hit an all-time low of 159.80 per dollar in the previous session, ended at 159.50/70 per dollar on Tuesday. The rupee ended firmer compared with Monday’s close of 159.60/90, and declined 3.9% this year.

“Today the market was very quiet. People were very reluctant to trade and there was not much of demand. We saw some dollar sales later in the day,” a currency dealer said.

Dealers said the rupee is under pressure mainly because of the global trend, and the trend is not specific to the rupee alone.

Central Bank Governor Indrajit Coomaraswamy was quoted in Daily FT as saying: “As far as the central bank is concerned, we do not see any cause for the pressure that’s there in the forex market.”

He said the Central Bank would not tolerate any speculation going on in the market.

“In the long run, enlighten the self-interest of those who operate in a forex market. We have a lot of instruments to restrict them... to restrict importers, to restrict exporters,” he said.

“We want to give the market a competitive exchange rate. We don’t want to intervene in the market. We want people to behave responsibly and to run the market in a responsible way.”

Dealers said the rupee will be under pressure, with exporters staying on the sidelines anticipating a fall in the unit, in line with other emerging market currencies.

Dealers expect the rupee to trade in the 163-165 range by the end of the year.

Central Bank officials were not immediately available for comment.

Foreign investors sold government securities worth a net Rs. 2.8 billion ($ 17.60 million) in the week ended 6 June, bringing the outflow so far this year to Rs. 19.9 billion, Central Bank data showed.

Discover Kapruka, the leading online shopping platform in Sri Lanka, where you can conveniently send Gifts and Flowers to your loved ones for any event including Valentine ’s Day. Explore a wide range of popular Shopping Categories on Kapruka, including Toys, Groceries, Electronics, Birthday Cakes, Fruits, Chocolates, Flower Bouquets, Clothing, Watches, Lingerie, Gift Sets and Jewellery. Also if you’re interested in selling with Kapruka, Partner Central by Kapruka is the best solution to start with. Moreover, through Kapruka Global Shop, you can also enjoy the convenience of purchasing products from renowned platforms like Amazon and eBay and have them delivered to Sri Lanka.