One week rupee forwards edge down on importer demand

REUTERS - Sri Lankan rupee one-week forwards eased slightly yesterday on mild importer dollar demand while nervous investors awaited the appointment of a new Central Bank governor, dealers said.
One-week dollar/rupee forwards, which have been acting as a proxy for the spot rupee, were trading at 146.60/70 per dollar at 0628 GMT, weaker than Thursday’s close of 146.00/30.
“Mild importer (dollar) demand is there, but the trading is dull as everybody is waiting to see the appointment of the new governor,” said a currency dealer, requesting not to be named. Deputy Governor Nandalal Weerasinghe told Reuters yesterday that the monetary board will be responsible for the Central Bank’s daily operations effective immediately, after the previous governor declined to seek reappointment amid a corruption probe. 

Government sources say disagreement between President Maithripala Sirisena and Prime Minister Ranil Wickremesinghe over the choice of a new governor has delayed the appointment.
 Analysts said the appointment could lead to the shake-up of the coalition government and the future of the economy.
Dealers said three-day dollar/rupee forwards, known as spot next, were trading at 146.60/60 per dollar. It did not trade on Thursday, and ended at 146.50/70 per dollar on Wednesday.
Spot next, which has acted as a proxy for the spot currency since January, indicates the exchange rate for the day following conventional spot settlement.
For yesterday’s trade, the spot next settlement takes place five days ahead due to the intervening weekend.
The Sri Lankan stock index was 0.15 percent higher at 6,292.52 as of 0732 GMT, on a turnover of Rs. 563.3 million($3.85 million).