September 4, 2018 / 11:38 AM / 3 months ago

Sri Lankan rupee hits record low for 11th session

COLOMBO, Sept 4 (Reuters) - The Sri Lankan rupee fell to an all-time low on Tuesday, marking its 11th straight session of setting fresh record lows.

The rupee, which hit a record low of 161.97 early in the trade, closed at 161.95/162.05 per dollar, compared with Monday’s close of 161.60/70.

The currency surpassed its earlier record of 161.65 hit in the previous session.

“There was (dollar) demand from local and foreign banks. We saw some oil and gas import bills,” a dealer said, requesting anonymity.

“The depreciation pressure remains as exporters are waiting to see the bottom in the rupee fall.”

The rupee will be under depreciation pressure with the year-end seasonal importer dollar demand, dealers said.

Absence of dollar conversions by exporters and outflows from equities and government securities also pushed the rupee lower, analysts have said.

Exporters are holding on to dollars as they expect the local currency to decline further, dealers said.

The Sri Lankan currency is also hurt by weakness in the Indian rupee. India is Sri Lanka’s biggest trading partner and the Indian rupee, which also hit a record low on Tuesday, has been one of the worst performers in Asia this year.

Foreign investors bought government securities worth a net 578.3 million rupees ($3.58 million) in the week ended Aug. 29, marking the first week of net buying since April. However, they have net sold 46.9 billion rupees worth securities so far this year, central bank data showed.

$1 = 161.5000 Sri Lankan rupees Reporting by Ranga Sirilal and Shihar Aneez; Editing by Amrutha Gayathri

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