REUTERS: The Sri Lankan rupee was trading steady in dull trade yesterday as dollar selling by banks offset importer demand for the greenback, dealers said.
“There is not much happening,” said a currency dealer asking not to be named.

The rupee was unchanged at 140.30/40 per dollar at 0701 GMT.

Dealers said importer dollar demand has reduced following government measures to discourage vehicle imports.

Vehicle imports will drop by at least 90 percent after the government changes the way it calculates the value of certain motor vehicles, officials said on Friday.
The government imposed a 100 percent margin on letters of credit for motor vehicles to discourage unnecessary imports, in a move to prevent dollar outflows and further weakening of the rupee currency.

Some dealers said dollar demand from importers is reducing ahead of the government’s budget in November and some new measures to discourage unnecessary imports.

The rupee hit a record low of 141.40 per dollar on Sept. 28, but has recovered over the past few days due to bank dollar sales which followed dollar selling by a state-run bank.

Sri Lanka’s main stock index was 0.22 percent, or 15.28 points, firmer at 7,111.34 at 0703 GMT. Turnover was Rs.481.4 million ($3.44 million).