COLOMBO, Nov 22 (Reuters) - The Sri Lankan rupee closed
steady on Friday despite downward pressure due to importer
dollar demand as banks were reluctant to trade above the 131.10
level, dealers said, a day after the government stressed the
importance of maintaining a flexible exchange rate regime.
The spot rupee was quoted at 131.10/20 per dollar,
flat from Thursday's close.
Three dealers said banks were reluctant to trade the
currency above 131.10 per dollar, a level seen as desirable by
the central bank, and forward trade was active.
Three-day forward or spot next ended at 131.22/25 per
dollar, a tad firmer than Thursday's close of 131.20/30, as some
banks sold dollars to minimise holding cost, dealers said.
Many banks held dollars expecting some change in the
country's foreign exchange policies in the budget.
While presenting the 2014 budget, President Mahinda
Rajapaksa, who is also the finance minister, said maintaining a
flexible exchange rate regime along with productivity
improvement is important to achieve the export revenue target of
$20 billion in 2020.
Dealers and banks, however, said there would be hardly any
change in the central bank's exchange rate policy as it is
already under a flexible regime, despite it being managed.
The rupee hit a record low of 135.20 on Aug. 28, but has
managed to stem further losses and has gained 3.10 percent since
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sunil