Rupee forwards edge up on dollar selling by banks

Reuters - Sri Lankan rupee forwards ended marginally stronger on Tuesday as dollar selling by banks outpaced demand for the greenback, dealers said.

The spot rupee was not traded as banks were reluctant to trade it below 144.00 levels amid moral suasion by the Central Bank. Central Bank officials were not available for comments.

Dealers said the one-week forward, which acted as a proxy for the spot currency, gained 0.1 % to end at 144.25/35 per dollar, compared with Monday’s close of 144.40/45. The rupee is under pressure despite a 150-basis-point increase in commercial banks’ statutory reserve ratio from 16 January. The Central Bank kept its key policy interest rates unchanged last week.

Commercial banks parked Rs. 40.492 billion ($281.88 million) of surplus liquidity on Tuesday using the Central Bank’s deposit facility at 6 %, official data showed.