Sri Lanka central bank probes forex dealers

Apr 25, 2012 (LBO) – The central bank will take action against dealers who are engaging speculative deals in forex markets without underlying transactions, Central Bank Governor Nivard Cabraal said. “We are now investigating into some speculative deals,” Cabraal said.

He said banks are not expected to buy dollars without underlying transactions to back them.

Sri Lanka’s rupee was quoted as low as 133.50/134.00 Wednesday as some exporters held back and importers covered positions, dealers said.

The rupee weakened as the Central Bank allowed the currency to trade more freely.

But a state bank offered dollars at 133.00 rupees and the dollar was later quoted at 132.80/133.25.