Sri Lanka’s rupee traded at 335.75/90 to the US dollar in Friday’s spot market, marking a slight improvement from the 336.00/30 level seen the previous day.
The currency has shown signs of stabilization after a period of volatility, with dealers quoting tighter spreads as trading activity continued.
While the exchange rate firmed, local bond yields moved higher, signaling ongoing tension in the sovereign debt market.
The divergence between the modest currency gain and rising borrowing costs suggests that investors remain cautious about the country’s fiscal trajectory despite short-term liquidity support.
This development follows a recent trend of incremental rupee strength, with the currency previously quoted at 335.25/35 and 334.65/75 in earlier sessions this week.
The consistent, albeit small, improvements indicate that market participants are closely monitoring capital flows and central bank interventions.