Rupee ends firmer on inward remittances

REUTERS: The Sri Lankan rupee ended firmer yesterday as late inward remittances ahead of the annual Haj pilgrimage surpassed the mild dollar demand from importers, dealers said.

The spot rupee ended at 145.00/15 per dollar, compared with Wednesday’s close of 145.40/45. One-week forwards were quoting at 145.15/30, compared with previous day’s close of 145.65/70, but were not traded as the spot was actively traded.

The spot rupee is usually managed by the Central Bank, and market participants use the forward market levels for guidance on the currency.
“There were inward remittances in the latter part of the day ahead of the festival,” a currency dealer said, asking not to be named.

Muslims in Sri Lanka will celebrate Eid al-Adha on Monday. 
Dealers said seasonal importer demand would pick up from mid-October. Central Bank Governor Indrajith Coomaraswamy said last week that the currency was not under upward pressure as capital inflows had not been of sufficient magnitude to exert such pressure.
The Central Bank has largely not intervened to defend the rupee ever since a dual-tenure sovereign bond issue raised $1.5 billion in July.