COLOMBO: The Sri Lankan rupee ended firmer on Thursday due to inward remittances and dollar sales by banks in the absence of central bank intervention, but dealers expect the local currency to edge down in the latter part of March on seasonal demand for imports. The spot rupee ended at 130.55/58 per dollar, firmer from Wednesday's close of 130.60/65.
The currency has risen 0.37 percent in the last six sessions through Thursday, Thomson Reuters data showed.
Dealers said the currency could strengthen in the absence of the central bank before it sees a gradual depreciation towards the end of March with seasonal importer dollar demand from the middle of the month.
The market has been expecting downward pressure to continue ahead of festival import demand in April and due to equity outflows, though the depreciation is expected to be mild as the central bank has strong reserves to defend the rupee.
However, since Feb. 27, the rupee has been on a gaining trend amid weak demand for dollars from importers, dealers said. The central bank said on Monday it bought a significant amount of dollars to keep the currency steady.
Foreign investors have sold a net 5.41 billion rupees worth of stocks in 19 straight sessions through Thursday, but they bought a net 709 million rupees worth of government securities in the week ended Feb. 26.
The rupee has gained about 3.5 percent since it hit a record low of 135.20 on Aug. 28 last year. It lost 2.5 percent in 2013.
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