COLOMBO: The Sri Lankan rupee ended little changed, though downward pressure continued, and dealers said the central bank had directed the market not to trade the currency beyond a certain level.
The central bank governor had said earlier that the currency had stabilized and was expected to stay firm with more than $200 million in inflows raised from Middle East banks.
Five currency dealers said the central bank had directed banks not to trade cash, tom, and spot rupee beyond 133.00 per dollar and spot next or three-day forwards beyond 133.05.
The rupee spot next, which was active in the market in the absence of spot trade, ended steady at 133.05/15 per dollar.
"It was a dull market as the central bank was capping at these levels," a currency dealer said.
Dealers also said spot next-next or four-day forward, which ended at 133.15/25 per dollar was picked up by some banks as it was not capped by the central bank.
However, an official at the central bank's International Operations Department said the bank had not directed the market to hold the local currency, which has recovered since it hit a record low of 135.20 to the dollar last week.
Central bank governor Ajith Nivard Cabraal on Thursday said the rupee's falling trend has reversed course and stabilized, unlike other emerging market currencies, and the central bank expects the currency to stabilize more due to $209 million in inflows.
The rupee has fallen nearly 4 percent this year, after depreciating around 10 percent in 2012.
Sri Lankan rupee little changed
