Mauritius’s rupee sank to a three- week low against the dollar and stocks headed for a sixth week of declines as a slowdown in the global economy curbs appetite for riskier, frontier-market assets. The currency depreciated 1.6 percent, the most since July 28, to 28.20 per dollar by 12:11 p.m. in the capital, Port Louis, extending its drop this week to 0.7 percent, the biggest weekly retreat since the five days through July 15. The 38- member SEMDEX index fell for a third day, dropping 1.4 percent to 1,916.73. State Bank of Mauritius Ltd., the country’s second- largest lender by market value, slumped 3.3 percent to 87 rupees, heading for the weakest since March 18. Emerging-market stocks fell for a second day as Morgan Stanley yesterday lowered its forecast for global growth this year, citing an “insufficient” policy response to Europe’s sovereign debt crisis, weakened confidence and the prospect of fiscal tightening. “A probable slowdown in the global economy could impact on Mauritius’s key sectors such as tourism, textiles and financial services activities,” Imrith Ramtohul, a senior investment manager who helps oversee 6 billion rupees ($212.8 million) at Mauritius Union Group, said by phone today. “The volatility seems to be overdone at times, taking into account the good fundamentals of leading companies in the country. Mauritian stocks are quite correlated with what’s happening in the major market.” Europe, Mauritius’s biggest trading partner, is the country’s largest source of tourists, with a share of 64 percent of total arrivals, according to the Central Statistics Office. New Mauritius Hotels Ltd., the largest Mauritian leisure operator by market value, retreated 2.4 percent to 83 rupees, heading for the lowest close since March 2009, and Naiade Resorts Ltd., the third-biggest tourism company, declined 2.1 percent to 28.50 rupees. Buying prices for the dollar were from 27.28 to 27.4451 rupees, while the selling price was 28.7425 per dollar, versus 28.7029 on Aug. 18, according to indicative exchange rates published today on the Bank of Mauritius’s website. To contact the reporter on this story: Kamlesh Bhuckory in Port Louis via Johannesburg at 1933 or gbell16@bloomberg.net To contact the editor responsible for this story: Antony Sguazzin in Johannesburg at asguazzin@bloomberg.net

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