The value of the rupee continues to depreciate against the dollar.According to the exchange rate issued by the Central Bank on Wednesday, the selling price of a dollar was recorded at Rs.150 and 54 cents. Last year the value of the rupee dropped by around 9 percent.
The main reason for this downfall was that the central bank who intervened to determine the value of the exchange rate, removed itself since September 4.
The main reason for this downfall was that the central bank who intervened to determine the value of the exchange rate, removed itself since September 4.
Economists point out that as exports in the past several years continued to increase and the import costs increasing is the main reason for this situation to arise
Foreign exchangers noted that the bank rated the selling price of the dollar between Rs.145-146 during the last week, however at present the bank rates it at 149 ruppees. Thereby, the rate has gone up by around Rs.3-4 in the last week
However, the depreciation of the rupee has created an advantageous position on foreign currency earners as imported goods prices has increased creating an adverse effect on prices of goods.
Importers noted that at the rate the dollar is increases they too will have to soon exit. They also noted that all goods that they got will have to be sold at a high price, including green peas, dhal , chickpeas , potatoes, and canned fish will increase.
Minister of Provincial Councils and Local Government, Faiszer Musthapha stated that the situation of the rising dollar has affected all across the globe and not only Sri Lanka.
Furthermore, he noted that a special mechanism has been put forward by the cabinet in order to face this challenge as the first step is to curtail expenses and increase exports.
