The Sri Lankan rupee traded firmer on Wednesday, moving away from its near one-week low as exporters offloaded dollars in the absence of importers, while a state bank sold the greenback at 130.85, dealers said.
The spot rupee was traded at 130.80/85 per dollar at 0638 GMT firmer from Tuesday’s close of 130.80/90, its lowest since Jan. 22.
Analysts said exporter dollar sales through banks and by corporates helped the rupee.
The rupee fell 0.2 percent in the previous two sessions because of bond outflows due to possibility of the U.S. Federal Reserves further trimming its monetary stimulus and demand for the greenback from importers, despite dollar selling by a state bank to prevent the fall.
Central Bank Governor Ajith Nivard Cabraal said on Monday Sri Lanka should not experience any major capital outflows or market volatility in the event the U.S. Federal Reserve scales back its stimulus more.
However, dealers said a Fed decision to cut the stimulus further will have an impact on the local currency interest rates.
Dealers expect the rupee to fall in the absence of any intervention by the central bank due to importer dollar demand.
The central bank said on Jan. 20 inflows of $1 billion from a recent sovereign bond sale would be kept in reserve, contrary to market expectations that a part of the bond proceeding would be allowed to be traded in the market.
The rupee has gained about 3.3 percent since it hit a record low of 135.20 on Aug. 28. It lost 2.5 percent in 2013.
At 0639 GMT, Sri Lanka’s main stock index was up 0.57 percent, or 35.44 points, at 6,254.27, recovering from its lowest since Jan. 22, hit in the previous session. (Reuters)
The spot rupee was traded at 130.80/85 per dollar at 0638 GMT firmer from Tuesday’s close of 130.80/90, its lowest since Jan. 22.
Analysts said exporter dollar sales through banks and by corporates helped the rupee.
The rupee fell 0.2 percent in the previous two sessions because of bond outflows due to possibility of the U.S. Federal Reserves further trimming its monetary stimulus and demand for the greenback from importers, despite dollar selling by a state bank to prevent the fall.
Central Bank Governor Ajith Nivard Cabraal said on Monday Sri Lanka should not experience any major capital outflows or market volatility in the event the U.S. Federal Reserve scales back its stimulus more.
However, dealers said a Fed decision to cut the stimulus further will have an impact on the local currency interest rates.
Dealers expect the rupee to fall in the absence of any intervention by the central bank due to importer dollar demand.
The central bank said on Jan. 20 inflows of $1 billion from a recent sovereign bond sale would be kept in reserve, contrary to market expectations that a part of the bond proceeding would be allowed to be traded in the market.
The rupee has gained about 3.3 percent since it hit a record low of 135.20 on Aug. 28. It lost 2.5 percent in 2013.
At 0639 GMT, Sri Lanka’s main stock index was up 0.57 percent, or 35.44 points, at 6,254.27, recovering from its lowest since Jan. 22, hit in the previous session. (Reuters)
