Sri Lankan rupee dips to record low on importer dlr demand

COLOMBO, Dec 23 (Reuters) – The Sri Lankan rupee edged down on Wednesday to a record low level it hit earlier this month as dollar demand from importers increased, but trading was thin as many market participants stayed away in a holiday-shortened week, currency dealers said.

The rupee fell 0.1 percent to touch 143.80, a record low for the currency that it first slipped to on Dec. 15. It was at 143.75/90 per dollar at 0816 GMT, down from Tuesday’s close of 143.65/85.

The markets will be closed on Thursday for a Buddhist religious holiday and on Friday for Christmas.

The currency has fallen 6.3 percent since the central bank allowed free float of the rupee on Sept. 4, and it is expected to weaken further in 2016 due to lower reserves and higher imports, says currency dealers.

It has fallen 8.8 percent so far in the year.

"There was importer demand, but the trading was very thin. The lowest deal was done at 143.80," a currency dealer said, asking not to be named.

The rupee is expected to remain weak unless Sri Lanka tightens both monetary and fiscal policies, dealers say.

The December monetary policy announcement is scheduled for Dec. 30 at 1930 hours (1400 GMT)

Sri Lanka’s main stock index was up 0.03 percent by 0826 GMT.

Turnover stood at 192.7 million rupees ($1.34 million).





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