The Sri Lankan rupee ended firmer on Thursday as exporters sold the US dollar, but concerns over possible further depreciation in the domestic currency in the absence of central bank guidance weighed on the sentiment, dealers said. Rupee forwards were active with two-week forwards ending at 152.50/70 per dollar, compared with Wednesday's close of 153.40/70. It hit a low of 153.70 in early trade.
The two-week forwards had fallen one percent since Monday through Wednesday, before rissing 0.6 percent on Thursday The rupee has weakened 1.1 percent so far this year. It fell 3.9 percent last year, following a 10 percent drop in 2015. The forex market will remain closed on Friday for a Hindu religious holiday.
"There were some exporter conversions which helped the rupee forwards to end firmer," said a currency dealer asking not to be named. The currency continued to be under pressure due to dollar demand from importers ahead of the traditional Sinhala-Tamil new year in mid-April, while foreign investors continue to sell government securities, dealers said. Foreign investors have net sold $325.70 million worth of securities in the seven weeks to Feb. 15, surpassing the total net foreign outflow of $324.3 million in the comparable period in 2016, according to the latest central bank and government data.
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