Steep fall triggers trepidation selling by exporters
On Wednesday the US dollar lost almost Re1 against the rupee as exporters feared a further weakening as they started selling their paper money in the interbank market.
The dollar landed on 98 paise to close at Rs155.74, This fall caused trepidation among exporters who kept their proceeds up for 90 days had to now witness this steep fall.
Atif Ahmed a currency dealer in the interbank market stated: “The free float of the exchange rate is now in favor of local currency since the improvement in the country’s external account. However, the main reason behind the call is the selling of dollars by the exporters, which has further curtailed the demand for the paper money in the interbank market”.
He further added that the dollar declined in the second half of the session and was traded at Rs155.50 for the next day. On Wednesday the dollar lost Rs1.22 against the rupee.
Although the market could open even lower on Thursday as it opened today at Rs156.40 instead of Tuesday’s rate of Rs156.72.
Exporters have already been quite against the depreciation of the US dollars as they got lower payment as in terms of the rupee whenever they import their exports into the country.
Nonetheless, Bankers agreed that the situation would still remain in favor of the rupee as the inflows of export proceeds will inflate in the last quarter of the fiscal year.