Rupee ends steady in dull trade

(Colombo) REUTERS: The Sri Lankan rupee ended steady yesterday as dollar demand from importers offset greenback selling by exporters in dull trade ahead of the long weekend, traders said.
The rupee ended flat at 159.50/60 per dollar. It has declined 3.98 percent so far this year and had hit a record low of 160.17 on June 20.

“Today there were not many trades. Everybody is on holiday mood ahead of the long weekend,” said a currency dealer asking not to be named.

The stocks, bond and foreign exchange markets are closed today for a public holiday and will resume trading on Monday.

Chinese President Xi Jinping has offered Sri Lanka a fresh grant of 2 billion yuan (US$295 million), as Beijing looks to expand its influence in the tiny island country off India’s southern tip.

Dealers have said the grant announced on July 21 helped ease the pressure on the currency.
Sri Lanka’s Central Bank Governor, Indrajit Coomaraswamy, had said earlier that the rupee’s decline was driven mainly by factors outside of Sri Lanka and that emerging-market currencies were under pressure.

Foreign investors sold government securities worth a net Rs.1.98 billion (US$12.4 million) in the week ended July 18, bringing the outflows so far this year to Rs.31.6 billion, Central Bank data showed.