Rupee edges up on exporter dollar sales; stocks gain

(Colombo) REUTERS: Sri Lanka’s rupee closed slightly firmer yesterday due to dollar selling by exporters, while stocks edged higher for a second straight session, moving away from an eight-week closing low hit early this week.

The rupee closed at 181.60/80 per dollar, compared with 182.15/25 in the previous session, market sources said. On Jan. 3, the rupee fell to an all-time low of 183.00 against the dollar.

The currency has appreciated 0.6 percent so far this year, Refinitiv data showed. 

Worries over heavy debt repayment after a 51-day political crisis have dented investor sentiment as the county is struggling to repay its foreign loans, with a record US$5.9 billion due this year including US$2.6 billion in the first three months. 

The Central Bank chief last week said around US$5 billion borrowing in the pipeline could help debt repayments.

The International Monetary Fund last week said it would resume discussions for further disbursal of part of a US$1.5 billion loan amid investor worries of heavy debt repayments. 

The rupee fell 16 percent in 2018, according to the Central Bank data. It was one of the worst-performing currencies in Asia, Refinitiv data showed, due to heavy foreign outflows. 

The rupee has declined 4.9 percent since a political crisis started in October. That crisis had dented investor sentiment and delayed Sri Lanka’s borrowing plans. 
A series of credit rating downgrades after the political crisis have made it harder for Sri Lanka to borrow as it faces record high repayments. 

The Colombo Stock Index ended 0.15 percent firmer at 5,960.34 yesterday. The benchmark index lost 5 percent in 2018. Turnover was Rs.725.2 million, less than last year’s daily average of Rs.834 million. 

Foreign investors were net buyers for a third straight session yesterday, buying a net Rs.310.7 million worth of shares. But they have been net sellers of Rs.2.05 billion worth of stocks so far this year and Rs.15.4 billion since a political crisis began on Oct. 26. 

The bond market saw outflows of Rs. 86.7 billion between Oct. 25 and Jan. 16, the latest Central Bank data showed.