COLOMBO, April 25 The Sri Lankan rupee ended a
tad firmer on Friday as exporter dollar sales outpaced light
importer demand for the greenback, while dealers expected the
currency to remain stable in the near-term in the absence of a
pick-up in private sector credit.
The spot rupee ended at 130.58/61 per dollar, firmer
from Thursday's close of 130.61/63.
"There was some bank dollar selling. It is from the exporter
dollar conversions and there was not much of import demand,"
said a currency dealer.
Many dealers said they were surprised by the lower credit
demand from the private sector even though key interest rates
have been at multi-year lows since January.
The benchmark 91-day treasury bill yield further dropped to
its lowest since January 2007, data showed on Wednesday, a day
after the central bank kept policy rates steady at multi-year
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 growth of 5.2 percent in
January this year and 13.3 percent in February 2013.
The central bank, in its monetary policy statement on
Tuesday, 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 range of 130.60-70 in
the near future until credit growth picks up. It 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 and Shihar Aneez; Editing by