Sun, 05 Dec 2021 Today's Paper

Rupee touches near 6-week low; stocks hit 5-1/2-year closing low

7 May 2019 12:00 am - 0     - {{hitsCtrl.values.hits}}


(Colombo) REUTERS: The Sri Lankan rupee fell for an eighth straight session yesterday to a near six-week low on dollar demand from banks, a day after clashes between two sectarian groups dented sentiment. 

Stocks dropped to their lowest close in about five-and-a-half years. 

Sri Lanka police arrested two men after a personal feud led to clashes between two sectarian groups in a beachside resort north of the capital, the site of one of the deadliest Easter Sunday suicide bombings, as schools reopened to near-empty classes. 

The rupee fell 0.23 percent to 177.55/75 per dollar from Friday’s close of 177.15/60, market sources said.

Analysts fear it could weaken further due to outflows from stocks and government securities. 

The island’s currency lost one percent last week, but is up 3 percent this year as exporters converted dollars after investor confidence stabilised following the repayment of a US $ 1 billion sovereign bond in mid-January. 

 The rupee dropped 16 percent in 2018 and was one of the worst-performing currencies in Asia due to heavy foreign outflows.

Foreign investors sold a net Rs.3.3 billion worth of government securities in the week ended April 30, extending the net foreign outflow to Rs.10 billion from the securities so far this year, the latest central bank data showed. 

The benchmark stock index dipped one percent yesterday to 5,386.27, its lowest close since December 6, 2012. 

Turnover was Rs.441.3 million, lower than this year’s daily average of Rs.578.5 million. Last year’s daily average was Rs.834 million. 

Foreign investors sold a net Rs.75.2 million worth of shares yesterday, extending the net foreign outflow to Rs.4.45 billion worth of equities so far this year. 

The latest instability follows Sri Lanka’s plunge into political turmoil in October last year, when President Maithripala Sirisena abruptly removed Prime Minister Ranil Wickremesinghe and then dissolved parliament. A court later ruled the move unconstitutional, and Wickremesinghe was reinstalled as premier. 

Investor sentiment took a big hit as a result of the 51-day political crisis, leading to credit rating downgrades and an outflow of foreign funds from government securities.


  Comments - 0

Add comment

Comments will be edited (grammar, spelling and slang) and authorized at the discretion of Daily Mirror online. The website also has the right not to publish selected comments.

Reply To:

Name - Reply Comment

A Sri Lankan giving dignified burials to unclaimed bodies for five decades

After their death, most people are memorialized at a service, surrounded by g

Focus on Laggala Gem mining big shots bigger than the law

The truth is now being uncovered regarding an illegal mining racket in state

How and why the TNA was formed twenty years ago

The Tamil National Alliance (TNA) is now twenty years of age. The premier pol

India lays emphasis on culture diplomacy with Sri Lanka

Indian Prime Minister Narendra Modi wanted to inaugurate the Kushinagar Inter