Rupee ends higher on inward remittances

REUTERS: The Sri Lankan rupee ended marginally higher yesterday as selling of the U.S. dollar by banks on account of inward remittances surpassed early demand for the greenback from importers, dealers said. 

The rupee was under pressure last week due to dollar demand from state-run Ceylon Petroleum Corp (CPC), which stocked up crude ahead of an expected fuel price hike, they added. 

 The spot rupee which traded at 153.73 per dollar during the day ended at 153.60/70 per dollar, slightly firmer from Thursday’s close of 153.62/68. 

“There was some (dollar) demand in the morning. But the rupee ended slightly firmer due to inward remittances which we saw during the latter part of the day,” said a currency dealer, requesting anonymity.  

Crude prices are expected to rise in the country after private fuel retailer Lanka IOC informed local media it is likely to hike rates as it has been selling at a loss. 

The rupee has been under pressure since January after the central bank stopped defending the currency and started buying the dollar to build the country’s depleted foreign reserves. 

The island nation has seen Rs.19.1 billion (US$124.31 million) of net inflows into equities this year as of yesterday’s close and Rs.33.8 billion into government securities as of Oct. 11, official data showed.