Sri Lankan security officials have warned that Islamist militants behind Easter Sunday's suicide bombings are planning attacks and could be dressed in uniform, as the archbishop of Colombo complained about insufficient security around churches.
Sri Lankan police are trying to track down 140 people believed linked to Islamic State, which claimed responsibility for the Easter Sunday suicide bombings of churches and hotels that killed 253 people.
The currency traded 0.2 percent weaker at 175.60 per dollar intraday before closing at 175.50/90, 0.1 percent lower than Friday's close of 175.30/80, market sources said.
Analysts fear it could weaken further due to outflows from stocks and government securities.
The island's currency lost 0.8 percent last week, but is up 4.1 percent so far this year, as exporters converted dollars amid stabilising investor confidence after the country repaid a $1 billion sovereign bond in mid-January.
The rupee dropped 16 percent in 2018, and was one of the worst-performing currencies in Asia due to heavy foreign outflows.
Foreign investors bought a net 268.2 million rupees worth of government securities in the week ended April 24, the first net buying in four weeks, but they have sold a net 6.6 billion rupees worth of securities so far this year, the latest central bank data showed.
The benchmark stock index ended 0.11 percent higher on Monday at 5,443.31, further moving away from its lowest close since Dec. 7, 2012 hit on Tuesday. On Tuesday, it suffered its worst percentage fall since Feb. 14, 2012.
Turnover came in at 162.7 million rupees ($926,537.59), its lowest since Feb. 14 and less than a third of this year's daily average of 597.1 million rupees. Last year's daily average was 834 million rupees.
Foreign investors bought a net 24.3 million rupees worth of shares on Monday, but they have been net 4.4 billion rupees worth of equities so far this year.
The latest instability follows Sri Lanka's plunge into political turmoil in October last year, when President Maithripala Sirisena abruptly removed Prime Minister Ranil Wickremesinghe and then dissolved parliament.
A court later ruled the move unconstitutional, and Wickremesinghe was reinstalled as premier.
Investor sentiment took a big hit as a result of the 51-day political crisis, leading to credit rating downgrades and an outflow of foreign funds from government securities.