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Sri Lankan rupee edges down on importer dollar demand
September 29, 2016 / 12:02 PM / a year ago

Sri Lankan rupee edges down on importer dollar demand

COLOMBO, Sept 29 (Reuters) - The Sri Lankan rupee ended weaker on Thursday, posting its fourth straight session of losses, as dollar demand from importers exceeded mild greenback sales by exporters and low inward remittances, dealers said.

The spot rupee ended at 146.90/147.00 per dollar, compared with Wednesday’s close of 146.62/70. It has fallen 0.7 percent so far this week.

“Some exporters are expected to come in if the spot rupee crosses 147 levels,” a currency dealer said asking not to be named.

The Sri Lankan central bank’s decision on Wednesday to hold key monetary policy rates steady suggested that policy makers were keen to support a slowing economy even as they kept a tight leash on rampant credit growth, analysts said.

After the rate decision, treasury bill yields dipped between 16 and 33 basis points.

Private sector credit growth was at 28.5 percent year-on-year in July, its highest since August 2012, but central bank chief Indrajith Coomaraswamy said on Wednesday that the central bank expected the credit expansion rate to slow to 20 percent by the year-end.

The central bank is under pressure from the International Monetary Fund (IMF) to continue rebuilding international reserves and maintain exchange rate flexibility to develop the foreign exchange market further. (Reporting by Shihar Aneez and Ranga Sirilal; Editing by Amrutha Gayathri)

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