COLOMBO Jan 8 The Sri Lankan rupee traded
slightly firmer on Wednesday due to a technical correction,
dealers said, a day after it fell 0.1 percent despite being
under pressure to gain due to expected $1 billion in inflows
from a sovereign bond.
The spot rupee was traded at 130.80/88 per dollar at
0519 GMT, slightly firmer from Tuesday's close of 130.80/90.
Dealers said the local currency had a technical correction
on Wednesday after the previous session's fall when foreigners
bought dollars to exit from rupee bonds.
They said the rupee was under pressure to appreciate, but by
how much would depend on what the central bank wanted to do --
whether to buy the inflows to build up its reserves or increase
dollar liquidity in the market.
A source close to the sovereign bond deal said the inflows
are expected next week.
Sri Lanka sold a $1 billion, five-year sovereign bond at par
to yield 6.00 percent.
The central bank on Thursday, while revealing its financial
and monetary policies for 2014, said it expected the rupee to
strengthen in the medium term and its direct intervention in the
foreign exchange market would be minimum.
The local currency has gained about 3.3 percent since it hit
a record low of 135.20 on Aug. 28. It lost 2.5 percent in 2013.
At 0524 GMT, Sri Lanka's main stock index was up 0.53
percent at 6,008.52, its highest since Aug. 23.
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by