Friday, 20 February 2015 00:00
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Reuters: The rupee edged down on Thursday as the central bank allowed it to fall by 10 cents against the dollar after seven flat sessions amid downward pressure due to tepid dollar demand from importers, dealers said.
Finance Minister Ravi Karunanayake said on 9 February that the rupee would be held steady at current levels and “there won’t be any devaluation at all”.
The spot currency ended at 132.90/133.00 per dollar compared with Wednesday’s close of 132.80/133.00.
“The Central Bank lowered the rate by 10 cents to 132.90 but nothing is happening other than the swaps,” said a currency dealer asking not to be named.
The Central Bank has been defending the spot currency’s level at 132.80 since Feb.6 through Wednesday, after it lowered the rate from 132.20 amid depreciation pressure.
Central Bank officials were not immediately available for comment.
Dealers said bond rates rose between 10 basis points to 15 bps following the auction of Treasury bills on Wednesday, indicating an upward direction in interest rates.
Trading in most forwards was thin after the central bank lowered the per-day premium to two cents on 9 February from five cents, dealers said.
Sri Lanka’s new Government last week said it would borrow up to $1.5 billion through sovereign bonds and $4 billion from the International Monetary Fund (IMF) to restructure expensive loans.
