Indian exporters of hot dip galvanized (HDG) coil have kept their offers stable during the past week at $750/mt FOB but transaction activity has remained depressed as exporters have been reluctant to push volumes with the Indian currency still appreciating, traders said on Thursday, April 20.
"Several of our buyers are telling us that they are unsure of the short-term price trend in the US market. This, combined with the appreciation of the Indian rupee against the US dollar, has prompted Indian exporters to stay away from concluding any significant transactions during the past week," a Mumbai-based trader said.
Market sources say that the Indian rupee has appreciated by almost five percent since January and is now at INR 64.52 to the dollar. They say that there is a continuing inflow of dollars into the country through the portfolio investment route and this, according to some currency dealers, may cause the Indian currency to pass beyond the INR 64 to the dollar level in the medium term.
The source said that Indian HDG exporters, having already adjusted their offers twice within the past 30 days, do not have any leeway to further increase offers to offset the currency appreciation at a time when US buyers are reluctant to conclude transactions.