Sri Lankan rupee weaker on equity outflows

COLOMBO, Sept 23 (Reuters) – The Sri Lankan rupee traded weaker on Friday as dollar demand for possible equity-related capital outflows surpassed mild exporter greenback sales, dealers said.

Rupee forwards were actively traded and spot-next forwards were at 146.45/55 per dollar at 0557 GMT, weaker than Thursday’s close 146.35.45. One-week forwards were at 146.60/70, weaker from Thursday’s close of 146.45/65.

The spot rupee was quoted at 145.90/146.60, but not traded.

Traders were unwilling to trade the spot rupee below 146.00 , the level desired by the central bank, dealers said.

"There is some selling today possibly for equity outflows," a currency dealer said, asking not to be named.

Sri Lanka’s share market saw a net foreign outflow of Rs867.8 million ($5.95 million) on Thursday.

The spot rupee is usually managed by the Central Bank and market participants use forward market levels for guidance on the currency.

Officials from the Central Bank were not available for comment.

Dealers said the market expects the local currency to be under downward pressure in the coming weeks due to the seasonal importer demand, which is expected to continue until mid-December.

Sri Lankan shares gained, with the benchmark Colombo stock index up 0.15 percent at 6,476.67 as of 0600 GMT. Turnover was at Rs311.3 million ($2.13 million).

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($1 = 146.2500 Sri Lankan rupees)

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