Sri Lankan rupee edges down ahead of cenbank policy statement; stx fall

Jan 03, 2017 (Reuters) – The Sri Lankan rupee edged down in thin trade on Tuesday amid worries over slowing foreign fund inflows, even as market players awaited central bank's key policy statement later in the day, dealers said.



Rupee forwards were active, with one-month forwards quoting at 151.00/15 per dollar at 0558 GMT, compared with Monday's close of 150.

95/151.00. The currency fell 3.9 percent in calendar 2016. One-week forwards, spot-next forwards and the spot rupee were hardly traded, dealers said.





"The market is quiet and waiting for some strong inflows," a currency dealer said, asking not to be named. "Most of the market players are also waiting for the central bank's road map on the financial policies for this year.



" The central bank will announce its policies and indicative targets for 2017 at 0930 GMT. The rupee has been under pressure due to imports and foreign investors exiting government securities, dealers said.



On Friday, the central bank raised the spot currency reference rate to 150.00, a record low against the dollar.

The banking regulator raised the spot reference rate by 50 cents last week, after a 40-cent increase in each of the previous two weeks amid sustained pressure on the currency.



Officials from the central bank were not immediately available for comment.

The central bank kept its benchmark interest rates steady on Friday for a fifth straight month as expected, saying credit growth was responding to earlier tightening measures. Dealers said the market was bracing for some depreciation in the rupee in January after the central bank said depreciation of the currency was not necessarily negative for the economy.

Sri Lankan shares were down 0.51 percent at 6,161.01 as of 0607 GMT. Turnover stood at 57.1 million rupees ($381,940).