COLOMBO, March 31 The Sri Lankan rupee ended
stronger on Friday, helped by inward remittances and selling of
the greenback by exporters ahead of the festival season, but the
gains were capped by dollar demand from a foreign bank in late
trade, dealers said.
Rupee forwards were active, with two-week forwards
ending at 152.45/50 per dollar, compared with Thursday's close
"There were a lot of conversions by exporters ... maybe to
pay the salaries and bonuses. The (inward) remittance flow was
also high," said a currency dealer who did not wish to be named.
"In the latter part of the day a foreign bank bought
dollars, maybe for repatriation of corporate profits due to the
end of the quarter."
The rupee has been under pressure due to dollar demand to
meet increased seasonal imports ahead of the traditional new
year that is celebrated on April 13-14, dealers said.
The central bank on Monday raised the spot rupee
reference rate by 10 cents to 151.70. It had raised the
reference rate by 25 cents on March 20.
The central bank raised interest rates for the first time in
eight months on March 24, saying tighter policy was a precaution
against a build-up of inflationary pressures.
Analysts said the rate hike, a move that was also aimed at
easing pressure on the rupee, could help stabilise the domestic
currency that has been hurt by rising imports and outflows due
to rupee bond sales by foreign investors.
Foreign investors net bought government securities worth 70
million rupees ($461,285) in the week ended March 22, but they
have net sold 63.2 billion rupees of such instruments so far
($1 = 151.7000 Sri Lankan rupees)
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by