Rupee stays flat

The rupee ended flat in the interbank market on Monday due to routine dollar demand from importers, dealers said.

The local currency closed at 155.90 against the greenback, unchanged from the previous close. In the open market, the rupee managed to post slight gains and ended at 156 against the dollar. It finished at 156.10 on Friday.

Dealers expect the local unit to gain grounds in the coming sessions due to the lack of higher import payments.

“The economic indicators could return to a positive trend this year,” a forex dealer said. “This optimism will have a positive effect on the exchange rate.”

The rupee has been supported on the back of a sharp contraction in the current account deficit, stable foreign exchange reserves and healthy workers’ remittances.

The current account deficit narrowed to $1.548 billion in the first quarter of the current fiscal year from $4.287 billion a year ago.

Remittances rose to $1.747 billion in July/September fiscal year 2020 from $1.486 billion in the corresponding month last year. The central bank’s foreign exchange reserves were $7.813 billion during the week ended October 11, compared with $7.757 billion in the corresponding week.