COLOMBO: The Sri Lankan rupee closed firmer on Tuesday due to dollar selling by exporters and a private foreign bank, and on inward remittances ahead of the festival season, dealers said.
The rupee ended at 143.15/20 per dollar compared with Monday's close of 143.25/35.
"The rupee ended firmer on dollar sale by a private foreign bank," said a currency dealer, asking not to be named.
Dealers said inward remittances for the festival season starting mid-December would ease some pressure off the local currency in the short term.
Prime Minister Ranil Wickremesinghe last week warned of pressure on the currency due to a China-led global slowdown and a possible Federal Reserve rate hike.
Sri Lanka is expected to seek an IMF stand-by arrangement to fend off a risk that its economy will be hurt next year by repercussions from events affecting major economies.
The country has not made a formal request to the International Monetary Fund yet but the fund's staff are looking at ways to help the island nation, an IMF spokesman said last week.
The central bank on Tuesday conducted a repo auction for the second straight day since Feb. 27 to absorb excess rupee liquidity.
The bank accepted 8.625 billion rupees ($60.23 million) or all bids received at 6.08 percent.
The offered amount was 10 billion rupees.
Commercial banks parked 101.306 billion rupees of surplus liquidity on Tuesday using the central bank's deposit facility at 6 percent, official data showed.
The central bank also absorbed a net 16.731 billion rupees on Tuesday, data showed, which analysts attributed to the repo auctions held on Monday and Tuesday.
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