Home / Front Page/ Rupee ends firmer on dollar sales; stocks drop

Rupee ends firmer on dollar sales; stocks drop


Comments / {{hitsCtrl.values.hits}} Views / Tuesday, 29 January 2019 03:21


Reuters: The rupee closed slightly firmer on Monday as foreign banks sold dollars, while offshore investors started purchasing Government bonds. Stocks snapped a three-day winning streak to end lower. 

The rupee closed at 181.40/60 per dollar, compared with Friday’s close of 181.60/80, market sources said. On 3 January, the rupee dropped to an all-time low of 183.00 against the dollar.  

The currency has appreciated 0.66% so far this year.

The Colombo Stock Index ended 0.08% weaker at 5,973.46 on Monday. The bourse dropped 0.16% last week, while the benchmark index lost 5% in 2018. 

Turnover was Rs. 465.3 million ($2.56 million), less than last year’s daily average of Rs. 834 million. 

Foreign investors were net buyers of Rs. 192.2 million on Monday. They sold a net Rs. 22.9 million worth of shares on Friday. They have been net sellers of Rs. 2.07 billion worth of stocks so far this year and Rs. 15.5 billion since the political crisis began on 26 October 2018. 

Investor confidence in Sri Lanka is stabilising after the country repaid a $ 1 billion sovereign bond in mid-January, Central Bank Governor Indrajit Coomaraswamy told Reuters on Monday. 

“We see signs of stabilisation in investor confidence, especially after we paid the loan without much difficulty. But there is much more to be done,” Coomaraswamy had said via a text message. 

However, investors maintained a cautious stance, awaiting cues about the Government’s borrowing and repayment of foreign loans, analysts told Reuters. 

Worries over heavy debt repayment after a 51-day political crisis have dented investor sentiment as the county is struggling to repay its foreign loans, with a record $ 5.9 billion due this year, including $ 2.6 billion in the first three months. The Central Bank Chief on 14 January said about $ 5 billion borrowing in the pipeline could help debt repayments. 

The International Monetary Fund on 16 January said it would resume discussions for further disbursal of part of a $ 1.5 billion loan amid investor worries of heavy debt repayments. 

The rupee dropped 16% in 2018, and was one of the worst-performing currencies in Asia due to heavy foreign outflows. 

The rupee declined 4.7% since a political crisis started in October. That crisis had dented investor sentiment and delayed Sri Lanka’s borrowing plans. 

Sri Lanka was plunged into political turmoil when President Maithripala Sirisena abruptly removed Prime Minister Ranil Wickremesinghe and then dissolved Parliament. A Court later ruled the move was unconstitutional and Wickremesinghe was reinstalled as Premier. 

A series of credit rating downgrades after the political crisis made it tough for the island nation to borrow as it faces record high repayments. 

The bond market saw an inflow of Rs. 4.7 billion in the week ended 23 January. But the market saw an outflows of Rs. 81.9 billion between 25 October and 23 January, the latest Central Bank data showed.

 

Rupee up by 0.6% in Jan: CB

Limits, depreciation trigger first import dip in 17 months


Share This Article

Facebook Twitter


DISCLAIMER:

1. All comments will be moderated by the Daily FT Web Editor.

2. Comments that are abusive, obscene, incendiary, defamatory or irrelevant will not be published.

3. We may remove hyperlinks within comments.

4. Kindly use a genuine email ID and provide your name.

5. Spamming the comments section under different user names may result in being blacklisted.

COMMENTS

Today's Columnists

Forensic Audits part of bond scam cover-up

Saturday, 25 January 2020

From the time the bond scam was carried out by the Ranil Wickremesinghe administration, that administration under the guidance of the former Prime Minister had been avoiding the law by regularly bringing up various distractions so that the true natur


Halting mega projects is untimely; Govt. can explore other options

Friday, 24 January 2020

In a Sunday newspaper on 5 January a news item titled ‘Mega projects on hold until August budget,’ ‘Drop in revenue after tax reductions prevents spending on major constructions,’ was not a development-friendly headline. It may be accurate o


Is any further expenditure on the Port City a waste of money?

Friday, 24 January 2020

Erase from the mind all that you have read and heard about it. Then take a blank piece of paper, draw an irregular circle, and draw a line to divide it into two. On the bottom half write 300 acres. That is our Port City! To get the size into a proper


Foundations of incivility

Friday, 24 January 2020

The lack of advanced political consciousness and democratic discipline can be considered as one of the main reasons for the crisis and the failure that Sri Lanka is facing. This can be considered a situation that has prevailed since independence. Sri


Columnists More