The Sri Lankan rupee ended weaker on Tuesday, as importer dollar demand surpassed mild selling of the greenback by exporters, dealers said. The spot rupee ended at 158.60/75, weaker from Monday's close of 158.50/60. The currency hit an all-time low of 158.80 per dollar on Friday, surpassing its previous low of 158.50 hit on May 16.
The currency has declined 3.2 percent so far this year. "Today there was importer demand from oil, construction related and some commodities. We saw some state banks also buying dollars to cover their imports," a currency dealer said.
Dealers said the rupee will be under pressure, with exporters staying on the sidelines in anticipation of a fall in the unit, in line with other emerging market currencies.
The pressure on the currency is unwarranted as gross external reserves are at $9.1 billion and the real effective exchange rate indexes indicate that the currency is competitive, the central bank has said.
Foreign investors sold government securities worth a net 787.24 million rupees ($4.97 million) in the week ended May 30, bringing the outflow so far this year to 17 billion rupees, central bank data showed.
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