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Sri Lanka’s forex reserves US$ 185mn In August

Economy News from Sri Lanka: The forex reserves of Sri Lanka increased to 8,532.6 million US dollars in the month of August 2019, official information showed. The gross official reserves of Sri Lanka consist of both the central bank and the treasury’s balances. Fiscal balances, which operate as debt raising and settlement, may decrease or rise without influencing financial stability.

Central bank reserves in Sri Lanka also continued to grow with inflows mixed up with supplementary currency and exchange-rate measures until July 2019, after bottoming out in January 2019. However, liquidity management was interrupted by the reversal of the supplementary monetary policy in August.

The central bank purchased $128 million from commercial banks in July. Data from August has not yet been published. Injections of liquidity started on August 07, obviously pushing down a rate of call cash.

In July, the month for which the recent information was published, Sri Lanka’s personal credit was negative, although there was favorable growth in June.

Government borrowings in both June and July were picked up. The ceiling policy rate, however, was reduced by 50 basis points on August 23 and the call cash rates were pushed down with injections of liquidity.