MUMBAI: The Indian rupee bucked the trend among its Asian peers and ended slightly lower on Friday, as continued local US dollar demand in the absence of substantial inflows weighed on the unit.
Likely US dollar sales by the Reserve Bank of India prevented further losses in the rupee, three traders said.
The rupee closed at 83.2850 against the US dollar, compared with its close at 83.2425 in the previous session. The unit was little changed on the week.
Other Asian currencies were higher on the back of a fall in US Treasury yields and the dollar index. The Korean won was the top performer among Asian currencies, rallying nearly 2%.
“There is no clear inflow in the market,” said Apurva Swarup, vice president at Shinhan Bank India. The absence of sizeable inflows and persistent importer dollar buying has maintained pressure on the rupee, he added.
Oil companies were buying dollars on Friday alongside demand from importers, a foreign exchange trader at a state-run bank said. “Nothing major is happening, so it (the rupee) is back in the same range.” The rupee remained in a range between 83.18 and 83.2950 during the week.
Meanwhile, Indian banks spoke with the RBI on Thursday on how a lack of volatility in the currency market over the last few weeks has hit their trading activity, Reuters reported earlier.
Investors now await a US labour market report due later in the day. The data is expected to show that non-farm payrolls fell in October while the unemployment rate held steady at 3.8%, according to Reuters polls.
Comments
Comments are closed for this article.