Financial Times

Pound now Rs 200
Sri Lanka's currency weakened to more than 200 rupees against the British pound in the middle of last week on concern that foreign reserves are shrinking rapidly.

The mid rate of the rupee between buyers and sellers fell to Rs 200.28 against the pound on Wednesday, compared to Rs 198.21 on Tuesday. On Friday it was Rs 200.51.

Central bank figures showed that the rupee has weakened 22.8 percent against the pound, 8.9 percent against the dollar, 23 percent against the euro and 15.92 against the yen in the past year.

The exchange rate is under pressure because of the widening trade deficit owing to the unprecedented increase in crude oil prices and dwindling foreign exchange reserves.

However, the rupee rose against the US dollar last week purely owing to a rise in the stock of dollars in the country.

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