Sri Lanka's rupee hit a new record low of 131.60 on Monday due to importer dollar demand ahead of the April festive season, despite the central bank's forecast of a substantial recovery on more than $365 million of inflows. The stock market meanwhile ended flat despite a 0.7 percent early gain and the foreign purchase of a 5 percent stake in diversified conglomerate Aitken Spence PLC for about 2.4 billion Sri Lanka rupees ($19.17 million).
The rupee closed at 130.00/131.00 a dollar, down from Friday's close of 125.55/70, depreciating more than 4.5 percent on the day. Three dealers Reuters spoke to said the highest trade was done at 131.60. It has depreciated 13.15 percent since the central bank stopped intervening to defend a specific price on February 9. Analysts expect the rupee to recover in April on declining dollar demand and expected exporter conversions.
Shares in Aitken Spence rose 0.69 percent to 116.00 rupees. The island nation's main share index edged up 0.01 percent or 0.41 points to 5,449.46, highest since February 24. The day's turnover was 3.13 billion Sri Lanka rupees ($25 million), well above last year's daily average of 2.3 billion. Volume was 113.5 million. Last year's daily average was a record 102.7 million.
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