Sunday, March 6, 2016

Sri Lanka forex reserves rise to US$6.56bn in Feb

ECONOMYNEXT - Sri Lanka's official foreign reserves increased 274 million US dollars to 6.56 billion US dollars in February 2016, from a month earlier, official data show.

The value of the Central Bank's gold stock rose to 881.5 million US dollars from 797.5 million dollars a month earlier.

Sri Lanka has lost foreign reserves steadily over the last year as dollars were sold to mop up excess import demand triggered by debt monetization.

Liquidity data shows interventions continuing in February.

Sri Lanka's forex reserves however consists of monetary reserves of the central bank and also fiscal reserves. 

Fiscal reserves can change without affecting the domestic monetary base (no reserve pass-through).

There was a sharp fall in January reserves, which was in excess of the interventions made by the central Bank. 

Central Bank officials told reporters last month that the reserve fall was due to debt repayments.

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