Rupee extends record low against US dollar, stocks open flat
ECONOMYNEXT – Sri Lanka rupee extended a record low against the US dollar Tuesday, crossing 157 rupees against the greenback in the spot market, while stocks opened flat, dealers and brokers said.
The rupee extended its record low to 157.20/30 rupees against the US dollar in early trading in the spot market on importer demand, dealers said. The US dollar closed at 156.85/95 rupees the previous day.
The central bank had printed money heavily to push rates down before a New Year season cash demand. Unless mopped-up by the central bank, the excess liquidity is absorbed by the banking system which lends to clients, in turn driving up import demand.
On April 18, 15 billion rupees were injected for 8 days. On April 20, 14 billion rupees was mopped up overnight through repo auction. On April 23 banks borrowed 9 billion rupees of printed money. Usually by this time most festival cash comes back to the system.
Gilt yield inched up on thin volumes in early trading Tuesday.
A five year bond maturing in 2023 was quoted at 10.02/03 percent, up marginally from 10.00/03 percent the previous day.
A ten-year bond was quoted at 10.25/35 percent, up from 10.25.30 percent the previous day.
The Colombo All Share index gained 0.08 percent, up 4.92 points to 6,530.17, and the S&P SL20 of more liquid stocks gained 0.20 percent, up 7.23 points too 3,682.75.
Market turnover was 100.7 million rupees.
Sampath Bank was trading 4.80 rupees higher at 311.80 rupees, while HNB was down 30 cents to 244.90 rupees.
Dialog gained 10 cents in early trading to 14 rupees, and Lanka Indian Oil Company was up 50 cents to 34.60 rupees.
Union Bank was down 30 cents to 15.10 rupees. (COLOMBO, 24 April, 2018)