Thursday, August 13 2026
Thursday, August 13 2026
MONETABRIEF – Sri Lanka's rupee was quoted at 333.60/65 to the US dollar in the spot market Thursday up from 334.00/25 a day earlier, dealers said, as authorities allowed the currency to appreciate amid foreign bond buying.
Sri Lanka has seen strong foreign bond purchases over the past with around 200 million dollars flowing into the market since the rupee stabilized.
Foreign bills and bonds holdings rose by 71 billion rupees to 192 billion rupees from June 18 to August 06.
Initially the rupee was not allowed to appreciate as the inflows were monetized by the central bank at weak rates, resisting a 'positive' shock to the rupee, showing a clear depreciation bias.
In July 348 million dollars were bought in July monetize the balance of payments, though the money could also have been bought while the currency appreciated.
Authorities also bought dollar heavily and resisted appreciation in January and February and promptly dishonored the excess liquidity under 'exchange as the first line of defence' which critics call interest rates as the last line of defence and busted the rupee.
Sri Lanka failed to get an upgrade from Standard and Poor's despite a budget surplus amid currency panic in the first half of 2026, while Pakistan got an upgrade.
Under flexible exchange rate/flexible inflation targeting, the central bank can deploy exchange rate in unpredictable ways to serve any depreciation or inflation bias.
By depreciating the rupee and pushing up the cost of living, macro-economists can decide which government loses the elections and which person has to leave the country of their birth to work in currency board regimes and by intensifying forex shortages can also trigger external defaults.
(Colombo/Aug13/2026)
| Sterling | 458.31 | Sell - |
| 3 month bill | 9.95 | 0.18 ▼ |
| 12-m bill | 10.20% | 0 - |
| Gold | $4035 | - - |
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