The guided benchmark market ‘spot’, administered since 13 May closed unchanged at Rs 360/365 to the US dollar in two way quotes for the tenth consecutive market day to yesterday (30 May), market sources told Finance Today.
The band in which the “guided market ‘spot’ ” may operate is +/- three per cent of the administered ‘spot’ value for transactions involving the Government of Sri Lanka (GoSL), Central Bank of Sri Lanka (CBSL) and or between the GoSL and/or CBSL with the market which was Rs 360.76 to the US dollar yesterday.
They further said that trades in the administered market ‘spot’ (Rs 360/365) were mainly restricted to ‘bank-client’ outright trades, while the interbank foreign exchange (FX) market was however dominated by swaps, which were outside the domain of the FX market for this purpose.
YoY as at yesterday, this administered market ‘spot’ has weakened by between 80.23-82.27 per cent (Rs 160.25-164.75), thereby causing cost push inflationary pressure as Sri Lanka is an import dependent economy.
In related developments, the administered ‘spot’ for official purposes, such as trades involving CBSL, GoSL and/or CBSL, GoSL and the market, YoY to yesterday has depreciated by 80.78 per cent (Rs 161.20). Yesterday, the value of this official administered ‘spot’ was fixed at Rs 360.76 to the dollar, while a year ago it was Rs 199.56. Meanwhile, the administered market ‘spot’ a year ago was Rs 199.75/200.25 to the dollar in two way quotes.
By Paneetha Ameresekere