Reserve money on Thursday was 270.4 billion rupees, marginally higher than the year-end target.
Stocks closed marginally higher with the All Share index closing 0.15 percent higher (3.75 points) and the Milanka index of liquid stocks closing 0.19 percent (6.24 points) higher.
Hatton National Bank, which drew investor interest amidst signs of a control tussle, closed 3.75 rupees higher at 121.00. Brown and Company, which is a key shareholder of HNB, saw its stock climb 3.75 rupees to close at 929.25.
John Keells Holdings closed flat at 125.75 rupees, Aitken Spence closed up one rupee at 399.75. The rupee closed 108.65/75 against the dollar in spot trade with an eight million dollar inflow of cash from an equity purchase hitting a thin market.
In the morning, money markets remained tight with overnight rates spiking to 17 percent as banks sought to square off before a three day weekend.
Liquidity melted from the system amidst a seasonal drawdown and there was no reverse repo auction Thursday.
Bankers say the customary drawdown of cash from the banking system was muted this year, indicating that the demand for ready cash was not as high as in the past.
The Central Bank, which also raises debt for the government, was again offering short term bills on 'tap' to raise cash for rates just under 20.
0 percent, dealers said.
The debt office had resorted to the so-called tap issues in December indicating that the government's year-end cash demand was unusually strong.
The bank also has to meet a year-end reserve money target, which has now become largely an academic exercise as the bank printed 45.
2 billion rupees from May to September and sent inflation rocketing to 19.6 percent.