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Reuters: The Sri Lankan rupee fell for an eighth straight session on Monday to a near six-week low on dollar demand from banks, a day after clashes between two sectarian groups dented sentiment.
Stocks dropped to their lowest close in about six-and-a-half years.
Sri Lanka police arrested two men after a personal feud led to clashes between two sectarian groups in a beachside resort north of the capital, the site of one of the deadliest Easter Sunday suicide bombings, as schools reopened to near-empty classes.
The rupee fell 0.23% to 177.55/75 per dollar from Friday’s close of 177.15/60, market sources said.
Analysts fear it could weaken further due to outflows from stocks and government securities.
The island’s currency lost 1% last week, but is up 3% this year as exporters converted dollars after investor confidence stabilised following the repayment of a $1 billion sovereign bond in mid-January.
The rupee dropped 16% in 2018, and was one of the worst-performing currencies in Asia due to heavy foreign outflows.
Foreign investors sold a net Rs. 3.3 billion worth of government securities in the week ended 30 April, extending the net foreign outflow to Rs. 10 billion from the securities so far this year, the latest Central Bank data showed.
The benchmark stock index dipped 1% on Monday to 5,386.27, its lowest close since 6 December 2012. Turnover was Rs. 441.3 million ($2.49 million), lower than this year’s daily average of Rs. 578.5 million. Last year’s daily average was Rs. 834 million.
Foreign investors sold a net Rs. 75.2 million worth of shares on Monday, extending the net foreign outflow to Rs. 4.45 billion worth of equities so far this year.
