Sri Lanka rupee opens weaker

Mar 23, 2012 (LBO) – The Sri Lankan rupee opened weaker against the US dollar Friday but firmed slightly in mid-morning trade with no sign of state bank intervention to prop up the currency, dealers said. The spot rate was around 130.40/ 50 and 130.30/ 70 around mid-morning with the rupee having opened lower around 130.60 at which business was done.

“There has been no intervention. We did not see any significant move for the central bank to be concerned about,” said a dealer.

“The rupee is not under pressure right now. There must be some inflows.”

The rupee closed at 130.10/130.30 to the dollar Thursday, up from Wednesday’s close of 130.25/130.50, having plunged to a record low of 131.60 on Monday.

The central bank has floated the currency after running down reserves to defend it and said it would intervene in future to smooth out any sharp fluctuations.

Treasury secretary P B Jayasundera said Thursday he expects the rupee to recover to around 125 to the US dollars after seasonal demand ahead of the April traditional new year festival eases.