(Bloomberg) -- Mauritius’s central bank vowed to defend the rupee against what it described as “unpatriotic” speculation that’s causing the currency to weaken.

The Bank of Mauritius plans to continue intervening in the foreign-exchange market to support the rupee, after acting twice in the past week to help strengthen the currency, Governor Harvesh Seegolam told reporters Friday in the capital, Port Louis.

Foreign-currency inflows to the Indian Ocean island nation totaled $1.38 billion since the beginning of 2023 through March 20, indicating a return to pre-pandemic levels. At the same time, the rupee slumped 5.6% against the dollar, with speculative activity increasing since the end of January, Seegolam said.

“In a situation where inflows have reached pre-pandemic levels, we would have expected banks to behave in a more responsible manner and adjust their rates according to market forces,” he said. “We have sought explanations from banks. The bank will sanction any deviation from prevailing circular letters” issued by the regulator, he added.

The central bank intervened in the domestic foreign-exchange market at 46.50 per dollar on March 17, and at 46 per dollar on Friday, he said. The bank is signaling that “any rate above 46 rupees would be excessive volatility,” Seegolam said. 

Companies in the hospitality and manufacturing industries are holding onto foreign currency, contributing to pressure on the rupee to weaken, the governor said. That behavior is “unpatriotic” because those industries benefited from state support from 2020 to 2022 following the Covid-19 pandemic.

“Enough is enough,” he said. “If they don’t want to lose money, they have to sell.”

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