Sri Lankan rupee hits record low
The Sri Lankan rupee fell to a record low on Monday on importer dollar demand amid lower liquidity for the greenback as exporters were reluctant to sell dollars on speculation that the currency could fall further, dealers said.
Trading was dull as the market awaited further clarification on the budget proposals announced late on Friday.
The rupee fell 0.21 percent to hit a record low of 142.70 per dollar, surpassing an all-time low of 142.55 hit on Friday.
The rupee ended at 142.70/95 per dollar, from Friday’s close of 142.45/55.
“Despite the budget discouraging vehicle imports, the rupee is still under pressure,” said a currency dealer. “
There is import demand was there and exporters were very reluctant to sell.”
Finance Minister Ravi Karunanayake revised some import taxes to discourage vehicle imports in the budget, which could ease the pressure on the rupee.
Dealers said the central bank was still intervening in the market to check the fall in the rupee. Officials at the Central Bank of Sri Lanka were not available for comment.
The central bank sold dollars worth a net $277.95 million in October and $523.80 million in September, latest data showed. Dealers said part of that money was spent to defend the rupee.
The rupee has dropped around 8.1 percent so far this year and 5.6 percent since the central bank allowed free-float on Sept. 4.
Commercial banks parked 145.97 billion rupees ($1.02 billion) of surplus liquidity on Monday, using the central bank’s deposit facility at 6 percent, official data showed.