Government Discussing to Control The USD Rate Again to 131/= Next Year

cseranga

cseranga

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Happy news Government discussing to control the USD rate again to 131/= from next year...

capitallinkceylon

capitallinkceylon

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they cant, its something impossible. Our trade gap is winding everyday. Recent budget changes has widen our budget deficit further. If they managed to keep it below 143 level until mid next yr it will be a miracle.

Ask every bank FX guys, they expect USD to go above 150 by next yr.

Ryan Hudson

Ryan Hudson

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it is possible and they will definitely do it

EquityChamp

EquityChamp

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Do you know why banks are always want to give an adverse picture for forex. They want to maximize their profits. Higher the rate for foreign exchange higher their profit. Do you know the profit earned by commercial banks by converting 1 USD into SL rupee. According to yesterdays prices Commercial Bank has kept 7 rupees as the margin between buy price and sell price. they are dealing in millions daily and imagine the profit they could use. So for foreign exchange don't trust the bank forecasts.

worthiness

worthiness

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Both public & private banks keep Rs.5-7 premium in buying & selling transactions of major foreign currencies. Those who are aware of high profit margin earned by banks always seek other sources.

Many freely walk to money exchange counters in main cities to buy foreign currencies at lower rate than banks in quickest time. Also, people sell foreign currencies to those counters at a higher exchange rate offered by banks.

worthiness

worthiness

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Is the discussion on pegging/fixed local currency to US$ again?

To maintain a constant exchange rate many countries peg their currency to US$. It seeks the access of world largest consumer market (USA) since over 40% international transactions are in US$. It facilitates international trade becoming exports goods competitive. Unstable exchange rate, in international trading always can be disruptive.

Real benefit of pegging is seen between countries with low cost of production & strong economies. In this case exporting country earns a greater amount of profit through exchange rates. Some believe pegging support to raise the living standard of the nation & overall economy growth.

One of the major cons is the requirement of having a large amount of reserves for constantly buying or selling local currency that may produce side effects such as higher inflation. Further, some Asian countries were indecisive of adjusting the peg for an economy’s currency at right time, though defended themselves against adverse global situations.

capitallinkceylon

capitallinkceylon

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http://www.economynext.com/Sri_Lanka_central_bank_to_tighten_monetary_policy-3-3792-1.html

current market and budget situations makes it impossible for the rupee to strengthen. With US economy recovering and recent rate hike shows further confidence in there economy, there's no reason for US dollar weakening.

This 130 levels is possible if the current budget had greater fiscal discipline, large number of FDI coming to our country and if US economy is struggling.

Keep in mind that there's a ticking time bomb ready to explode in jan 2018, where nearly $5billion bonds maturing. (Previous govt borrowing). Every month there's more $100million bonds maturing and CB is settling those by borrowing more from the market by hosting bond auctions and printing money.

Quibit

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You can have a discussion to bring it down to 100/=.
How effective. This is wrong speculation. Smile

capitallinkceylon

capitallinkceylon

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http://www.economynext.com/Sri_Lanka_rupee_seen_falling_further_in_2016-3-3816.html

please go through this

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Government Discussing to Control The USD Rate Again to 131/= Next Year

1 Government Discussing to Control The USD Rate Again to 131/= Next Year Thu Dec 17, 2015 4:00 pm

cseranga

2 Re: Government Discussing to Control The USD Rate Again to 131/= Next Year Thu Dec 17, 2015 4:43 pm

capitallinkceylon

3 Re: Government Discussing to Control The USD Rate Again to 131/= Next Year Thu Dec 17, 2015 5:27 pm

Ryan Hudson

4 Re: Government Discussing to Control The USD Rate Again to 131/= Next Year Thu Dec 17, 2015 6:16 pm

EquityChamp

5 Re: Government Discussing to Control The USD Rate Again to 131/= Next Year Thu Dec 17, 2015 10:05 pm

worthiness

6 Re: Government Discussing to Control The USD Rate Again to 131/= Next Year Thu Dec 17, 2015 11:19 pm

worthiness

7 Re: Government Discussing to Control The USD Rate Again to 131/= Next Year Fri Dec 18, 2015 8:26 am

capitallinkceylon

8 Re: Government Discussing to Control The USD Rate Again to 131/= Next Year Fri Dec 18, 2015 9:11 am

Quibit

9 Re: Government Discussing to Control The USD Rate Again to 131/= Next Year Wed Dec 23, 2015 9:02 am

capitallinkceylon

10 Re: Government Discussing to Control The USD Rate Again to 131/= Next Year

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