The Sri Lankan rupee closed 0.2 percent weaker on Friday as worries about more bomb attacks after the Easter Sunday attacks weighed, while stocks edged up for the third straight session after hitting a more than six-year low early in the week. The currency ended at 175.30/80 to a dollar, 0.2 percent weaker than Thursday's close of 175.00/50, Refinitiv data showed.
Analysts fear it could weaken further due to outflows from stocks and government securities. Dollar-denominated bonds issued by Sri Lanka's government tumbled across the curve on Thursday following a fresh bomb scare.
The island's currency lost 0.8 percent this week, but is 4.2 percent up so far this year, as exporters converted dollars amid stabilising investor confidence after the country repaid a $1 billion sovereign bond in mid-January. The rupee dropped 16 percent in 2018, and was one of the worst-performing currencies in Asia due to heavy foreign outflows.
Foreign investors sold a net 268.2 million rupees worth of government securities in the week ended April 24, the first net buying in four weeks, but they have sold a net 6.6 billion rupees worth of securities so far this year, the latest central bank data showed.