Oct 10 (Reuters) - The Sri Lankan rupee ended slightly firmer near its three-month high on Thursday as dollar sales by banks outpaced early importer demand for the greenback.
Dealers expect the currency to be stable and trade within a narrow range in the short term.
They expect the rupee to move with little volatility after the central bank governor said the currency would "behave in a stable manner" in the next few months.
The spot rupee ended at 131.10/15 per dollar, near its highest since July 15 and firmer from Wednesday's close of 131.15/20.
The currency traded within a range of 131.00 and 131.20 during the session, dealers said.
The rupee hit a record low of 135.20 on Aug. 28, but has managed to stem further losses since then.
Globally, the dollar pulled further away from an eight-month low on Thursday, as investors grew hopeful that Washington will end the political wrangling and break the U.S. fiscal impasse that has sapped market confidence.
The dollar was close to an eight-month trough touched last week against a basket of currencies as the U.S. government shutdown entered a second week. (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sunil Nair)
