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Sri Lankan rupee trades steady ahead of cbank rate review
June 22, 2017 / 7:07 AM / 6 months ago

Sri Lankan rupee trades steady ahead of cbank rate review

COLOMBO, June 22 (Reuters) - The Sri Lankan rupee was steady on Thursday ahead of the central bank’s policy review as dollar demand from importers offset the selling of the U.S. currency by exporters, dealers said.

Sri Lanka’s central bank is expected to keep its key interest rates steady at more than three-year highs at a policy announcement on Friday, a Reuters poll showed, to boost faltering growth hit by adverse weather.

The spot rupee, which has been trading for four straight sessions after being inactive for six weeks, was at 153.30/45 per dollar at 0645 GMT, largely unchanged from Wednesday’s close of 153.30/35.

The spot rupee resumed trading on Monday for the first time since May 5 when the central bank had fixed its reference rate at 152.50.

“There’s normal demand and supply. The spot did not trade beyond 153.40 and we can see sellers when the spot touches 153.40 levels,” said a currency dealer, requesting anonymity.

“There is no intervention or moral suasion. Exporters are very relaxed as the spot is trading.”

Dealers said they expect seasonal demand for the dollar to pick up from August.

The rupee has been under pressure after the central bank said it would allow gradual depreciation of the currency and set a target of $1.2 billion in direct market purchases of dollars to boost the island nation’s reserves this year, mainly to meet a target set by the International Monetary Fund for a three-year $1.5 billion loan.

Sri Lankan shares were down 0.11 percent at 6,722.81, as of 0658 GMT. Turnover stood at 301.3 million rupees ($1.97 million). ($1 = 153.1000 Sri Lankan rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Amrutha Gayathri)

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