COLOMBO, March 1 The Sri Lankan rupee ended
firmer for a fourth straight session on Wednesday as greenback
sales by exporters and banks outpaced importer dollar demand,
Rupee forwards were active with two-week forwards
ending slightly firmer at 151.70/80 per dollar, compared with
Tuesday's close of 151.80/152.00.
Spot rupee ended steady at 151.25/40 per dollar.
"There was some (dollars) selling from a state bank
time-to-time. I don't think it is the intervention. They must
have sold their positions," said a currency dealer, who
requested not to be identified.
"There were no (foreign) bond sellers in the past few days,
that is the main reason for the currency to stay at these
Dealers added that exports could be hurt as severe drought
has affected the production of tea and other commodities.
"The rupee will be under pressure with higher oil imports
due to drought," the currency dealer said.
The rupee is under pressure due to dollar demand from
importers ahead of the traditional Sinhala-Tamil New Year in
mid-April, and as foreign investors continue to sell government
securities, dealers stated.
Sri Lanka's fuel imports in January jumped to double typical
monthly levels, with the country rushing to plug an energy
shortfall as severe drought hits its hydropower output, industry
Foreign investors sold a net 15.37 billion rupees ($101.62
million) in the week ended Feb. 22, extending the outflow from
government securities to 64.5 billion rupees.
Sri Lanka could face balance-of-payments pressure due to
foreign outflows from government securities, a government
document showed last week, even as the island nation was in the
process of raising up to $2.5 billion from foreign borrowing.
The rupee has weakened 1 percent so far this year. It fell
3.9 percent last year, following a 10 percent drop in 2015.
($1 = 151.1000 Sri Lankan rupees)
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sherry