Rupee at record low as state bank lowers dollar selling rate

19 June 2015 03:20 am - 0 - {{hitsCtrl.values.hits}}

A A A

REUTERS: Sri Lankan spot rupee fell to a record low yesterday after a state bank, through which the Central Bank usually directs the market, lowered its dollar selling rate by 20 cents to Rs.134.20 per dollar, dealers said.

The currency fell 0.15 percent, after staying steady for three straight sessions, as the state-run bank lowered its dollar selling rate.The rupee hit 134.20, its lowest level ever, compared with Wednesday’s close of 134.00, which was the previous all-time low.

The move comes a day after currency dealers told Reuters that it would not be sustainable to defend the local currency with state bank dollar sales in the long run as this could bring down foreign exchanges reserves to a “dangerous level”.

“They (Central Bank) will gradually allow depreciation as it is not sustainable to defended the currency,” a dealer said on condition of anonymity.

The rupee, which fell 2.27 percent so far this year, is on the decline mainly due to a stronger dollar, the Central Bank has said, while higher imports and rising private sector credit in a lower interest rate regime also weighed on the currency. Central Bank Governor Arjuna Mahendran said last week that the country should let market forces determine its rupee exchange rate and warned that trying to buck the global trend of a rising dollar was “suicidal”.

One-week forwards were weaker at 134.35/55 per dollar compared with Wednesday’s close of 134.15/35, while three-month forwards were at 136.04/10 per dollar compared with Wednesday’s close 135.90/136.10.

On Wednesday, Sri Lanka called on banks and investment houses to propose terms for a foreign currency term financing facility as it seeks to raise up to $500 million to meet the costs of some externally-funded projects stated in its 2015 budget after the government raised nearly $1 billion via a 10-year sovereign and development bond on May 28.

Dealer also said some foreign investors in government securities were selling rupee-denominated bonds, which could put pressure the currency, along with importer dollar demand. In the stock market, the benchmark index was up 0.11 percent at 7,057.47 by 0609 GMT. Turnover stood at Rs.262.6 million.

Order Gifts and Flowers to Sri Lanka. See Kapruka's top selling online shopping categories such as Toys, Grocery, Kids Toys, Birthday Cakes, Fruits, Chocolates, Clothing and Electronics. Also see Kapruka's unique online services such as Money Remittence,Astrology, Courier/Delivery, Medicine Delivery and over 700 top brands. Also get products from Amazon & Ebay via Kapruka Gloabal Shop into Sri Lanka

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.

Rupee at record low as state bank lowers dollar selling rate

Comments - 0

Add comment

RECOMMENDED

‘Spike in blast fishing’ poses renewed threats to Sri Lanka’s marine ecosystems

UDA owned land in Thalawathugoda; UDA Minister Prasanna Ranatunga under the spotlight for forceful occupation of reserved land

Loss-making SMIB faces political pressure in recovering loans

Baltimore Bridge Collapse: MV Dali, SL authorities anchored in mystery?

Has Sri Lanka become a potential hub for the illegal wildlife trade?

Spotlight on Moragahakanda Development Project Moragolla villagers lose livelihoods and down to one meal a day

Ambitious Sri Lankan jobseekers ‘trafficked into Ukraine war zones’

Most Viewed in News

New Visa procedure implemented

Former MP Palitha Thewarapperuma dies from electrocution

Street food vendor arrested for verbally harassing foreigner

Two racing drivers arrested over Fox Hill tragedy

Racing event tragedy leaves seven dead including eight-year-old child

Complaint lodged over Piumi Hansamali's possession of Gota’s Range Rover

MIRROR CRICKET

Is Chamari Athapaththu Sri Lanka’s greatest cricketer ever?

Athapaththu back atop ICC Women’s ODI Batting Rankings

Chamari Athapaththu sets big goal for T20 World Cup

How does CSK get best out of Pathirana?

TODAY'S HEADLINES

Foreign powers intensify surveillance on Presidential elections as strategic interests take centre stage

New uterine loop for monkey birth control

Sajith avoids reception hosted for Iranian President

Do not be afraid to use weapons, Minister Alles tells police

Pakistan lose key players for last two T20Is against New Zealand

Sri Lanka secures third spot in South Asian Kurash Championship 2024

Athapaththu back atop ICC Women’s ODI Batting Rankings

Army forms committee to probe Diyatalawa Fox Hill Supercross accident