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Rupee ends firmer on bond buying by foreign investors

5 August 2016 12:00 am - 0     - {{hitsCtrl.values.hits}}

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REUTERS: The Sri Lankan rupee ended firmer yesteday as foreign investors sold dollars to buy local bonds on hopes of higher returns after the Central Bank’s policy rate hike, dealers said.


The spot rupee, which was last actively traded on June 13, resumed trading on Thursday. It traded at 145.60/68 per dollar, compared with Wednesday’s indicative price of 145.80/90, a dealer said.
“There was a lot of foreign buying in local bonds. The spot currency is being actively traded today,” said a currency dealer, asking not to be named.


“Foreign investors have been buying bonds since the IMF (International Monetary Fund) loan was approved and we see some sudden increase after the appointment of the new Central Bank Governor and last week’s policy rate hike.”


Dealers also said foreign investors were also converting dollars to buy equities.
The spot rupee is usually managed tightly by the Central Bank, and market participants use the forward market levels for guidance on the currency.
One-week rupee forwards ended at 145.80/88 per dollar, up from Wednesday’s close of 146.00/15.


The Central Bank last week raised its main interest rates by 50 basis points each in a surprise move aimed at curbing stubbornly high credit growth that is adding to concerns about inflationary pressures.
Foreign investors have bought 64.5 billion rupees (US $443.30 million) worth of government securities, since the IMF agreed to a US $1.5-billion bailout package, from April 29 through July 27, Central Bank data showed.

 

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

 


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

 


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