Rupee weakens on importer dollar demand

Saturday, 30 August 2014 04:44 - - {{hitsCtrl.values.hits}}

Reuters: The Sri Lankan rupee ended weaker on Friday as importer dollar demand outpaced exporter greenback sales, while dollar sales by state banks prevented a sharp fall, dealers said. The dealers expect the local currency to remain steady for the rest of the year after positive comments by the Central Bank Chief last week. Central Bank Governor Ajith Nivard Cabraal said the banking regulator would intervene in the thinly-traded market whenever needed to keep the rupee stable. The rupee ended at 130.22/25 per dollar, compared with Thursday’s close of 130.18/24. Dealers said one of the two state banks through which the Central Bank usually intervenes to stem major declines in the currency, was selling dollars to prevent a sharp fall. “There was importer demand but a state bank sold dollars to selective trades at 130.20,” a currency dealer said. “In the long term we see the rupee to be stable.” Foreign investors bought a net 250 million rupees ($ 1.92 million) worth of government securities in the week ended 27 August, official data showed. The Central Bank rejected all bids for the 91-day treasury bill at an auction for the second straight week, while the yields on the 182-day and 364-day treasury bills held steady at the weekly auction on Wednesday.

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