COLOMBO: Sri Lankan rupee forwards traded steady on Thursday despite dollar demand from importers as the central bank's intervention via moral suasion prevented a sharp fall in the local currency, dealers said.
Exporters were reluctant to sell dollars ahead of the budget announcement for 2015 on Friday, dealers said.
The spot currency was quoted at 130.75/95 per dollar but not traded, dealers said. It closed at 130.60/80 on Friday.
The three-day forwards, or spot-next, actively traded in the absence of spot, were at 130.85/131.00 per dollar at 0641 GMT, little changed from Tuesday's close of 130.90/131.00. Both currency and stock markets were closed for a holiday on Wednesday.
"The pressure is there from the importers, but exporters are reluctant to sell ahead of the of the budget," a currency dealer said on condition of anonymity.
Dealers said the central bank persuaded banks not to trade the spot-next below 130.90 after capping it at 130.85 in early trade. Central bank officials were not immediately available for comment.
Nandalal Weerasinghe, a central bank deputy governor, said on Monday the monetary authority would intervene to prevent short-term volatility in the rupee and said the moral suasion was to prevent sharp changes.
Weerasinghe said the central bank has been preventing a sharp appreciation in the currency by intervening to maintain some stability over the last 12 months.
Sri Lanka's stock market index was up 0.59 percent, or 41.93 points, at 7,203.09 as of 0700 GMT.
Turnover was 1.69 billion rupees ($12.9 million), with 54.6 million shares changing hands.
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