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Rupee ends lower on dollar demand

The partially convertible currency closes at 54.375/385 per dollar, weaker than Thursday’s close of 54.21/22
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First Published: Fri, Apr 26 2013. 09 41 AM IST
Weakness in local stocks, which snapped a four-day winning streak, to end 0.62% lower hurt the currency, dealers said. Photo: Priyanka Parashar/Mint
Weakness in local stocks, which snapped a four-day winning streak, to end 0.62% lower hurt the currency, dealers said. Photo: Priyanka Parashar/Mint
Updated: Fri, Apr 26 2013. 11 57 PM IST
Mumbai: The Indian rupee ended down on Friday, falling 0.8% for the week, dragged by month-end dollar demand from importers and weak equities.
Weakness in local stocks, which snapped a four-day winning streak, to end 0.62% lower hurt the currency, dealers said.
Continued month-end dollar demand from importers, particularly crude oil importers, had also been a drag on the rupee, they said.
The focus now shifts to the central bank’s rate setting meeting next week which is widely expected to lower policy rates by 25 basis points.
A Reuters poll on Thursday showed that bullish bets returned on the Indian rupee for the first time in over a month.
Global currency markets are awaiting the release of US gross domestic product (GDP), and a strong number will be able to lift the risk sentiment.
“The fall in the rupee is basically on account of the month-end dollar buying and squaring-off of positions,” said Satyajit Kanjilal, chief executive at ForexServe.
“If the US GDP numbers are good, it will give a boost to risk-on and the rupee.”
The partially convertible rupee closed at 54.375/385 per dollar, weaker than its Thursday’s close of 54.21/22.
Broadly, sentiment still favoured the rupee with the government likely to take more steps to revive growth in the next two-four months.
The Indian government pitched for a rating upgrade on Thursday at a meeting with ratings agency Standard and Poor’s, a top finance ministry official said, citing steps taken by it to control a high fiscal deficit and revive investments.
In the offshore non-deliverable forwards, the one-month contract was at 54.61, while three-month was at 55.19.
In the currency futures market, the most-traded near-month dollar/rupee contracts on the National Stock Exchange, the MCX-SX and the United Stock Exchange all closed around 54.56, with a total traded volume of $4.6 billion. Reuters
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First Published: Fri, Apr 26 2013. 09 41 AM IST
More Topics: Indian rupee | dollar | currency | Sensex | markets |
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