COLOMBO, March 10 The Sri Lankan rupee ended
slightly weaker on Friday in dull trade as importer dollar
demand surpassed exporter greenback sales, a day after the
central bank's moral suasion curbed further decline, dealers
Rupee forwards were active, with two-week forwards
ending at 152.25/45 per dollar, compared with Thursday's close
"We didn't see much of activity and the (inward) remittances
were also very low, though there were some import demand," said
a currency dealer on condition of anonymity.
Another dealer said the trading was light after Thursday's
moral suasion reversed some deals.
Central bank officials were not available for comment.
International Monetary Fund on Wednesday urged the country's
central bank to rebuild foreign reserves while maintaining
exchange rate flexibility.
Following its second review of a $1.5-billion three-year
loan programme, the IMF said it had discussed with Sri Lankan
authorities the need to push forward with reforms due to an
uncertain external environment.
Dealers expect the rupee to depreciate between 6 percent and
8 percent this year.
Analysts said inflow from up to $1.5 billion sovereign bond
issue sooner than later could help ease some pressure on the
Sources who know about the bond deal said top central bank
officials have already left for the United States for a road
show on the sovereign bond issue announced last month.
S&P Global Ratings said in a statement on Tuesday it
considers exchange rate stability to remain a major priority for
Sri Lanka's policymakers and its central bank, limiting monetary
The central bank is struggling to maintain a flexible
exchange rate in the face of heavy foreign outflows from
government securities. The rupee has depreciated 1.2 percent so
far this year, having lost 3.9 percent of its value against the
dollar last year.
Foreign investors bought a net 701 million rupees ($4.64
million) worth of government securities in the week ended March
1, recording the first weekly net inflow for the year. They have
sold a net 63.76 billion rupees of such instruments so far this
($1 = 151.3500 Sri Lankan rupees)
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sherry