COLOMBO May 2 The Sri Lankan rupee ended weaker
on Friday due to light importer dollar demand in dull trade, but
dealers expect the currency to be stable in the near term as
private sector credit demand remained sluggish.
The spot rupee ended at 130.60/65 per dollar, weaker
from Wednesday's close of 130.61/63.
"We have seen light importer demand," said a currency
Both the stock and foreign exchange markets were closed on
Thursday for May Day, a public and bank holiday.
Lower credit demand from the private sector, even though key
interest rates have been at multi-year lows since January, has
At an auction on Tuesday, the central bank rejected all bids
for the benchmark 91-day treasury bills with yields already at
their lowest since January 2007, data showed.
Last week, the central bank kept policy rates steady at
Private sector credit grew 4.4 percent year-on-year in
February, the slowest since May 2010, latest data from the
central bank showed. That compared with a growth of 5.2 percent
in January this year and 13.3 percent in February 2013.
The central bank, in its monetary policy statement last
week, expressed confidence that private sector credit growth
would rebound in the second quarter and push up the pace of
Dealers expect the rupee to trade in a 130.60-130.70 range
in the near future until credit growth picks up. The currency
has been hovering between 130.55 and 130.70 since March 3,
Thomson Reuters data showed, with the central bank intervening
to smoothen any sharp volatility.
(Reporting by Ranga Sirilal; Editing by Anand Basu)