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Sri Lankan Rupee depreciating at unprecedented speed, warns Dilith ...
The leader of ‘Sarvajana Balaya’, Member of Parliament (MP) Dilith Jayaweera, states that the Sri Lankan Rupee is currently depreciating even faster than during the country’s worst economic collapse. Speaking at a press conference held today (15), he said the situation has been driven by what he described as an unstructured import–export policy implemented based on external advice rather than a locally formulated economic vision. He noted that he had previously warned about the expected rise of the US dollar rate and argued that the main issue lies in the lack of a rational trade framework. According to him, vehicles are being imported in US dollars while taxes are collected in rupees, creating a situation where rupees are accumulated domestically while dollars continuously flow out of the country. He further stated that the rising US dollar has already created a severe economic crisis, with local industries and factories under significant pressure. He added that such a rapid depreciation of the Sri Lankan Rupee has never been seen even during the most difficult periods of the economic crisis. Jayaweera warned that if immediate policy decisions are not taken, there will be insufficient time to stabilize the situation. He also cautioned that ongoing economic contraction will soon begin to directly affect the public, potentially leading to widespread disruption across civilian systems.
Sri Lanka rupee depreciation driven by global trends, CBSL governor ...
Thursday May 14, 2026 10:40 am ECONOMYNEXT – The recent depreciation of the Sri Lanka rupee is a reflection of shifting global market conditions rather than internal economic mismanagement, central bank governor Nandalal Weerasinghe insisted, but admitted intervening to prevent excessive swings. Under the current flexible inflation targeting framework, the exchange rate is primarily determined by market demand and supply in line with macro-fundamentals, he said at a public lecture on the 2025 Annual Economic Review. “Exchange rate under this framework is a result of what happens in the other areas of the economy,” Weerasinghe said, adding that the currency is now moving in tandem with global trends where the US dollar is strengthening due to international uncertainty. He said regional economies, including India, Thailand, and the Philippines, are experiencing comparable pressures. “For example, today also I saw media reports Indian Rupee is at the lowest level in history despite 700 billion dollars of reserves RBI is having,” Weerasinghe said. India too had a Flexible Inflation Targeting framework which allows the market to determine the rate, he said, and rising import expenditures for petroleum, fertilizer, and other commodities have increased demand for foreign exchange. However, he said that while the central bank allows market forces to lead, it continues to intervene to prevent excessive swings. Follow the EconomyNext WhatsApp Channel Get breaking updates, instant alerts, and exclusives. Join Now “We obviously intervene because one of the reasons why we built reserves from almost nothing at 2020 to close to 7 billion dollars now, the reason for building reserves is that part of that should be used to manage volatility,” he said. Sri Lanka rupee was depreciated from 309.50/60 on December 30, 2025 long before the Middle East War, though it is now a convenient excuse for macro-economists to escape accountability. The rupee closed at 326.00/327.00 to the one week US dollar on Wednesday, with no spot trading. Read more Sri Lanka private credit roars back, rupee whimpers in money printed through fx swaps The rupee was also aggressively depreciated from 292 to the US dollar to 309 over 2025 by purchasing dollars for new money (monetizing the BoP) and not giving dollars (convertibility) when the unsterilized liquidity came back as imports. The central bank had a chance (perhaps the last chance) to allow the rupee to appreciate in February and restore mark...
Ripple effect of sharp depreciation of Sri Lanka rupee
The recent sharp decline of the Sri Lankan Rupee (LKR) over the past month has reignited anxieties reminiscent of the 2022 financial collapse
Current Rupee depreciation driven by global factors, unlike in 2022 ...
Central Bank Governor Dr. Nandalal Weerasinghe says the present depreciation of the Sri Lankan Rupee is fundamentally different from the sharp fall in 2022, as this time, it is driven by global conditions rather than domestic mismanagement.
