COLOMBO: The Sri Lankan rupee edged down on Thursday on importer dollar demand and as foreign investors sold bonds in the absence of central bank intervention, said dealers.
Rupee forwards were active, with the spot-next at 147.45/55 per dollar as of 0646 GMT, compared with its previous close of 147.40/50.
The spot rupee was quoting at 146.90/95 per dollar, but was hardly traded. It was steady last week after two weeks of losses. The spot rupee is usually managed by the central bank, and market participants use the forward market levels for guidance on the currency.
“We see both importer dollar demand and foreign selling in local bonds,” said a currency dealer, asking not to be named. “There is a bit of uncertainty with the budget coming up next month. So all are waiting for some firm direction.”
The government’s national budget is scheduled to be announced on November 10. The central bank has been buying dollars from the market to accumulate reserves to meet targets set by the International Monetary Fund under a $1.5-billion loan deal, dealers said.
Officials at the central bank were not available for comments. Dealers said they expected the rupee to remain under pressure due to seasonal imports.
Sri Lankan shares were steady, with the benchmark Colombo stock index up 0.02 percent at 6,445.84 as of 0649 GMT. Turnover stood at 152.6 million rupees ($1.04 million).
($1 = 147.3000 Sri Lankan rupees)
