Sri Lanka rupee opens stronger

Nov 17, 2009 (LBO) – Sri Lanka’s rupee opened stronger against the US dollar with a state bank that usually acts for the monetary authority buying at 114.25 Tuesday up from yesterdays 114.35 levels, dealers said. Sri Lanka’s rupee was pegged at 114.80 levels for most of the year following float in March that got the country out of a balance of payments crisis, by ending a cycle of liquidity injections (money printing) and dollar sales.

The central bank is now withdrawing liquidity from money markets and has full control of the exchange rate.

In September the Central Bank bought 437.15 million US dollars. In October it bought 364.0 million US dollars and also sold 118.50 million US dollars, according to official data. Sri Lanka has received large foreign inflows after it signed a deal with the International Monetary Fund which increased investor confidence.