Bloomberg News

Mauritius’s Rupee Gains Most in 3 Months as Bank Raises Rate

June 14, 2011

June 14 (Bloomberg) -- Mauritius’s rupee strengthened the most in almost three months against the dollar after the central bank raised its benchmark rate to curb inflation.

The Indian Ocean island nation’s currency appreciated as much as 2 percent to 28 per dollar and traded 1.9 percent stronger at 28.05 by 10:58 a.m. in the capital, Port Louis. That made it the second-best performer worldwide against the dollar today after Solomon Islands’ dollar, according to data compiled by Bloomberg.

“Yesterday’s quarter of a percent rise is almost equivalent to the yearly yield on the dollar, for instance,” Nitish Benimadhu, a fund manager at the Port Louis-based Anglo Mauritius Financial Services Ltd., said by phone today. “This attracts hot money.”

The Bank of Mauritius raised its key repo rate to 5.5 percent following a quarterly Monetary Policy Committee meeting, the second increase in three months. The rupee has gained 10 percent against the dollar since the start of 2011.

“Market sentiment and momentum for the rupee are stretching,” Benimadhu said. “The rupee is not expected to weaken in the next six months.”

--Editors: Philip Sanders, Ana Monteiro

To contact the reporter on this story: Kamlesh Bhuckory in Port Louis at kbhuckory@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net


Cash Is for Losers
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus