Sri Lanka forex reserves slip to US$4.8bn in January 2021

Sri Lanka’s gross official reserves were at 4.8 billion US dollars in by end January 2021 Central Bank Governor W D Lakshman said and efforts were underway to boost them.

Sri Lanka reported 5,665.1 million dollars of foreign reserves by the end December 2020.

Sri Lanka is targeting year end gross official reserves of 5.5 billion US dollars.

The central bank had bought about 10 million dollars in recent days after a requirement of banks to sell 10 percent remittances converted by recipients.

Banks have to sell converted dollars to the central bank under a formula depending on availability and settle the balance every quarter.

Last year Sri Lanka received about 7.1 billion US dollars in remittances and this year the central bank is expecting 7.5 billion US dollars in 2021.

Sri Lanka is giving priority to settling debt, and had already paid ‘large chunks’ Governor Lakshman said.

This year also Sri Lanka would maintain an unblemished record in repaying debt, he said.

Sri Lanka was in talks with several central banks, multilateral agencies and banks to get finances and swaps, he said.

However the International Monetary Fund is not included among them as they are unlikely to agree to an ‘alternative’ economic management model is followed in Sri Lanka.


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