COLOMBO, April 28 The Sri Lankan rupee fell on
Friday on importer dollar demand, while bond yields dropped for
a second day with the market expecting the local currency to
trade steady on expected dollar inflows, dealers said.
Sri Lanka expects to raise up to $1.5 billion via a
sovereign bond issuance, while another $1 billion is expected
from two separate syndicated loans.
Rupee forwards were active, with two-week forwards
closing at 153.30/40 per dollar, compared with Thursday's close
"The rupee will stabilise with higher dollar liquidity after
the inflows," a currency dealer said, asking not to be named.
"Bond yields fell around 20 basis points and foreign
investors were buying bonds."
A government move to double the borrowing limit of
development bonds to $3 billion in 2017 is also expected to
Finance Minister Ravi Karunanayake on Thursday blamed
"technical difficulties" for a two-month delay in receiving an
around $160 million loan tranche from the IMF and said the
disbursement was expected after June 14.
Sri Lanka has seen a rise in foreign inflows into equities
and government securities since early this month, with foreign
investors buying shares worth a net 13.7 billion rupees in 26
consecutive sessions through Friday.
Foreign investors have also net bought government securities
worth 4.17 billion rupees in the week ended April 19, although
they have net sold 58 billion rupees worth of government bonds
so far this year.
(Reporting by Shihar Aneez; Editing by Biju Dwarakanath)