Rupee ends weaker; stocks slip to near 5-year closing low

Thursday, 18 October 2018 00:49 - - {{hitsCtrl.values.hits}}

The rupee crashed to a fresh record low of 71.96 against the US dollar in intra-day trade on the back of rising bond yields and crisis in emerging market currencies

Reuters: The rupee ended weaker on Wednesday as banks and importers bought the US dollar while stocks edged lower to end near a five-year closing low.

The Central Bank on Wednesday said it has secured a $ 1 billion eight-year loan from China Development Bank.

The rupee ended at 171.00/15 per dollar, compared with its previous close of 170.90/171.10.

The rupee had fallen to an all-time low of 171.60 per dollar on 10 October due to foreign selling in government securities and exporter greenback sales.

The Central Bank surprised financial markets on 2 October by leaving its key policy rates unchanged, despite heavy pressure on the rupee and foreign outflows from government securities.

The rupee has weakened 1.1% so far this month after a 4.7% drop in September against the dollar. It has declined 11.3% so far this year.The Colombo stock index fell 0.33% to 5,776.75 points, ending near its lowest close since 3 December 2013, hit on Monday. It fell 3.6% last month and is down 9.3% so far this year.

Data from the Central Bank showed foreign investors sold government securities worth a net Rs. 6.3 billion ($ 37.04 million) in the week ended 10 October. Sri Lanka has seen a net outflow of Rs. 80.6 billion in securities so far this year.

Stock market turnover was Rs. 448.3 million ($ 2.62 million) on Wednesday, well below this year’s daily average of Rs. 774 million.

Foreign investors were net sellers of Rs. 110.4 million worth of shares on Wednesday, extending the year-to-date net foreign outflow to Rs. 8.95 billion worth of equities.

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