Sri Lanka’s Central Bank (CB) this week intervened in the local money markets, for the first time in 16 months, to halt pressure on the rupee against the US dollar. The last time such intervention happened was in January 2017. Money market dealers on Friday confirmed comments to a foreign news agency by CB Senior [...]

Business Times

CB intervenes to arrest rupee depreciation

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Sri Lanka’s Central Bank (CB) this week intervened in the local money markets, for the first time in 16 months, to halt pressure on the rupee against the US dollar.

The last time such intervention happened was in January 2017. Money market dealers on Friday confirmed comments to a foreign news agency by CB Senior Deputy Governor Dr. Nandalal Weerasinghe that the banking regulator pumped dollars on Tuesday and Wednesday to control the volatility of the currency.

“Yes intervention happened and will continue to happen in the future as the rupee is under pressure,” one dealer said.

The rupee has been under pressure and hit a high of Rs. 158 per dollar earlier in the week. On Friday it was selling at Rs. 157.80.

The CB, which has been reluctant to intervene in the market and artificially prop up the rupee, has come under criticism for allowing the currency to depreciate at levels which impact on the cost of living.

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