February 6, 2019 / 12:25 PM / in 2 months

Sri Lanka rupee ends firmer on exporter dollar sales

    COLOMBO, Feb 6 (Reuters) - ** Sri Lanka's rupee         
rose 0.3 percent on Wednesday due to exporter dollar sales,
while a trade union action at customs dampened importer demand
for the greenback. 
**  Sri Lankan customs officers on Tuesday called off a strike
that left 6,000 containers stranded at the country's main port
and put pressure on food prices, after the government agreed to
reinstate their boss for three months. The strike by thousands
of officials began a week ago in protest at the sacking of
Director General PSM Charles, who authorities blamed for a drop
in customs revenue last year.             
** The rupee closed at 177.70/178.00 per dollar, compared with
Tuesday's close of 178.20/50, market sources said.
** Rupee posted a weekly gain of 2.8 percent last week as
exporters converted dollars and foreign investors purchased
government securities after a statement from the International
Monetary Fund (IMF) and government's $1 billion debt repayment
boosted confidence.
** The IMF on Jan. 16 said it would resume discussions in
February for further disbursal of part of a $1.5 billion loan.
** The currency has appreciated 2.8 percent so far this year. 
** Investor confidence in Sri Lanka is stabilising after the
country repaid a $1 billion sovereign bond in mid-January,
Central Bank of Sri Lanka Governor Indrajit Coomaraswamy said
last week.             
** Worries over heavy debt repayment after a 51-day political
crisis that resulted in a series of credit rating downgrades    
dented investor sentiment as the county is struggling to repay
its foreign loans, with a record $5.9 billion due this year,
including $2.6 billion in the first three months. 
** Fitch Solutions Macro Research, a subsidiary under Fitch
Group, on Thursday downgraded its average forecast for the rupee
to 186.00 per U.S. dollar for this year and 192.00 for 2020,
from 177.00 and 183.00 respectively. 
** The rupee dropped 16 percent in 2018, and was one of the
worst-performing currencies in Asia due to heavy foreign
outflows.
** The political crisis had dented investor sentiment and
delayed Sri Lanka's borrowing plans. Sri Lanka was plunged into
political turmoil when President Maithripala Sirisena abruptly
removed Prime Minister Ranil Wickremesinghe and then dissolved
parliament. Wickremesinghe was later reinstalled as premier. A
court ruled the dissolution was unconstitutional. 
** The Colombo Stock Index        ended 0.41 percent weaker at
5,957.41 on Wednesday, its lowest close since Jan. 23. Stocks
declined 1 percent in January, and ended lower for a fifth
straight session.
** Turnover was 249.2 million rupees ($1.40 million), less than
a third of last year's daily average of 834 million rupees.
** Foreign investors net sold 6.8 million rupees worth shares on
Wednesday. They have been net sellers of 2.8 billion rupees
worth of stocks so far this year, and 16.1 billion rupees since
the political crisis began on Oct. 26, 2018.
** The bond market saw inflows of 924.7 million rupees in the
week ended Jan. 30, the latest central bank data showed.
** For a report on global markets, click here            .
** For a report on major currencies, click       
    
    ($1 = 177.4000 Sri Lankan rupees)

 (Reporting by Ranga Sirilal and Shihar Aneez)
  
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