Lanka rupee hits new 31-month high on inflow

Friday, 10 June 2011 00:22 - - {{hitsCtrl.values.hits}}

Reuters: The Sri Lankan rupee hit a fresh over 31-month high on Thursday due to foreign inflows amid exporters’ dollar sales, currency dealers said, while shares gained from a five-week lows, snapping three straight falls, on retail speculative buying.

The rupee hit 109.30 a dollar during early trades, its highest since 30 October 2008, before ending at 109.45/48 from Wednesday’s close of 109.45/50, Reuters data showed.

Currency dealers said exporter selling on fears of further appreciation and around $15 million inflow into a foreign bank resulted in the early gain. Later the currency retreated to close a tad firmer on importer demand for the dollar.

Sri Lanka’s main share index closed 0.3 per cent or 21.92 points firmer at 7,279.62, inching up from its lowest since 5 May, due to speculative retail buying.

“Despite some strategic crossings taking place, the market still seems to be largely dominated by speculative investors,” NDB Stockbrokers said in a research note.

Foreign investors were net sellers of Rs. 382.9 million worth of shares on Thursday and they have sold a net Rs. 7.02 billion worth shares in 2011 after a record 26.4 billion in 2010.

The day’s turnover was Rs. 4.06 billion ($ 37.1 million), well above last year’s average of 2.4 billion and this year’s daily average of 2.9 billion.

Traded volume was 486 million, against a five-day average of 408.7 million. The 30-day and 90-day average trading volumes were 148.9 million and 102.3 million, respectively. Last year’s daily average was 67.9 million.

The bourse is still Asia’s best performer in 2011 with a 9.7 per cent gain, after bringing in the region’s top return of 96 per cent last year.