Home / Front Page/ Rupee ends steady; CSE dips

Rupee ends steady; CSE dips

Comments / {{hitsCtrl.values.hits}} Views / Saturday, 12 January 2019 00:17


REUTERS: Rupee closed steady on Friday in dull trade as dollar selling by banks offset importer demand for the greenback, while political uncertainty dented investor sentiment. 

Sri Lankan shares posted a more than six-week closing low. 

The Colombo Stock Index ended 0.28% weaker at 5,967.27, its lowest close since 26 November 2018. The trading volume was thin as worried investors awaited political cues after the last quarter’s turmoil. The benchmark stock index lost 5% in 2018.  Turnover was Rs. 814.1 million ($ 4.48 million), less than last year’s daily average of Rs. 834 million. 

Foreign investors sold a net Rs. 143.2 million worth of shares on Friday. They have been net sellers of Rs. 14.3 billion worth of stocks since a political crisis began on 26 October 2018. The bond market saw outflows of Rs. 74.3 billion between 25 October 2018 and 2 January, the latest Central Bank data showed. 

Foreign investors pulled a net Rs. 22.8 billion out of stocks last year, while they net sold Rs. 159.8 billion from government securities from January through 26 December 2018, bourse and Central Bank showed data. 

The rupee ended at 181.90/182.00 per dollar on Friday, compared with 181.90/182.10 in the previous session, market sources said. On 3 January, the rupee had fallen to an all-time low of 183 against the dollar. 

The rupee fell 19% in 2018, making it one of the worst-performing currencies in Asia, according to Refinitiv data, due to heavy foreign outflows. 

The rupee has declined about 5% since the political crisis started. 

The Central Bank said last week it would stick to an exchange rate policy of cautious intervention in times of excessive volatility in the forex market. 

The policy is designed to maintain a competitive exchange rate and support the rebalancing of the current account, thereby supporting a gradual build-up of reserves, Central Bank Chief Indrajit Coomaraswamy said last week, unveiling economic policies for 2019. 

The Central Bank on Wednesday said that the Reserve Bank of India (RBI) had agreed to provide $ 400 million to it under a regional swap facility and it had also requested a further bilateral swap arrangements of $ 1 billion. 

President Maithripala Sirisena appointed a Cabinet of Ministers from his rival party on 21 December 2018 after he was forced to reinstate Ranil Wickremesinghe as Prime Minister, 51 days after he was sacked. The crisis is expected to ease, though tense relations between the two men could cause fiscal problems, analysts say. Parliament has approved Rs. 1.77 trillion ($ 9.39 billion) to meet the first four months of expenditure in 2019, averting a government shutdown from 1 January. 

Sri Lanka plans to increase government spending by 13.2% from last year to Rs. 4.47 trillion ($ 24.51 billion) in 2019, the Finance Ministry said on Tuesday. Credit agencies Fitch and S&P downgraded Sri Lanka’s sovereign rating in early December, citing refinancing risks and an uncertain policy outlook.

Share This Article

Facebook Twitter


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.


Today's Columnists

A case for reviewing plantation management

Thursday, 23 May 2019

Last week, I elaborated on ‘Going Beyond Agronomic Research for Plantation Reform’ with the aim of beginning a conversation on the importance of non-agronomic research to understand the many problematic areas that plague the plantation sector, in

How are we doing in e-government?

Thursday, 23 May 2019

It is customary to assess some aspect of the performance of a country using a composite index such as the Ease of Doing Business Index or the Network Readiness Index. For government services, there is the e-Government Development Index (EGDI), issued

National introspection in the aftermath

Thursday, 23 May 2019

“The immediate task for the Government is to guaranty the safety and security of all innocent Muslims and prevent a recurrence of 1983 … One cannot eradicate one evil with another” – Anatomy of an Islamist Infamy (III), CT, 9 May. In this, th

Dhammika Perera an anti-establishment candidate

Thursday, 23 May 2019

During the holy Vesak weekend the phones were buzzing all over Sri Lanka over a story that appeared on a web page. The story said that Prime Minister Ranil Wickremesinghe had met with business tycoon Dhammika Perera whose business empire contribute

Columnists More