Thursday Jun 11, 2026
Thursday Jun 11, 2026
Thursday, 11 June 2026 00:25 - - {{hitsCtrl.values.hits}}
The Sri Lankan rupee strengthened sharply against the US dollar yesterday after the Central Bank of Sri Lanka (CBSL) tightened regulations governing the conversion of export proceeds, reducing the mandatory conversion period from 90 days to 30 days.
The USD/LKR spot rate closed at Rs. 332.25/333.00 yesterday, appreciating significantly from Tuesday’s close of Rs. 337.00/337.75.
The currency had come under pressure in recent sessions, with the spot rate closing at Rs. 335.75/336.25 on Monday compared to Rs. 330.00/332.00 at the end of the previous week. During the period, the rupee weakened from an intraday high of Rs. 330.75 to a low of Rs. 337.10 against the dollar.
Market participants attributed the recent depreciation largely to a surge in foreign exchange demand from importers, many of whom rushed to secure dollars several months ahead of their actual payment requirements amid concerns over potential global supply disruptions linked to the escalating conflict in the Middle East.
At the same time, exporters were reportedly holding on to foreign currency earnings for longer periods in anticipation of further rupee depreciation, reducing the supply of dollars to the domestic market and exacerbating exchange rate pressures.
The CBSL’s move to shorten the export proceeds conversion period is expected to accelerate the repatriation and conversion of export earnings into rupees, increasing foreign exchange liquidity and helping to stabilise the market.
The latest measure follows a series of discussions between the CBSL, authorised dealers, and market participants aimed at easing volatility in the foreign exchange market, which officials have maintained remains fundamentally supported by strong inflows from exports, workers’ remittances, and tourism.
