Bloomberg News

Mauritius Rupee Weakens for Third Straight Day on Europe Debt

July 19, 2011

July 19 (Bloomberg) -- Mauritius’s rupee weakened for a third day against the dollar as concern the debt crisis in Europe, the Indian Ocean island nation’s biggest trading partner, may affect the economy.

The currency depreciated 0.2 percent to 28.45 versus the dollar by 1 p.m. in Port Louis, matching its longest losing streak since July 7. A close at this level will be the weakest since July 13.

“The European peripheral economies continue to struggle in debt capital markets, with namely Spain and Italy finding it increasingly costly to raise capital,” Mauritius Commercial Bank, the country’s largest lender by market value, said in an e-mailed note to clients. Currencies for emerging markets which have the EU as their major trading partner “have been hit by the higher level of risk aversion,” it said.

Europe is the country’s largest buyer of Mauritian exports, including sugar and textiles, and is the source of almost two- thirds of tourists. Mauritius, with a population of 1.3 million people, has about 67 percent of its import bills and 39 percent of foreign currency revenue denominated in dollars, according to Bank of Mauritius.

Consolidated rates from the Bank of Mauritius website today show a buying price of 27.5774 to 27.7381 for the dollar, with an average selling price of 29.0386.

The 38-member SEMDEX stocks gauge declined less than 0.1 percent to 2,051.72, led by MCB, State Bank of Mauritius Ltd. and New Mauritius Hotels Ltd., the three largest companies by market value.

--Editors: Gordon Bell, Antony Sguazzin

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


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