News & market updates

Sri Lanka's cabinet approved resumption of the Lower Malwathu Oya hydro project, with the estimated cost rising 106.02% from Rs22.9bn in July 2019 to Rs47.18bn in Dec 2025. The increase reflects about a 74% rupee depreciation and broader inflation and monetary policy effects.

Sri Lanka's rupee weakened to 309.50/60 per US dollar (from 309.25/35) while government bond yields were slightly down; selected closing yields: 15.12.2026 at 8.35/45%, 15.09.2027 at 8.80/90%, 15.09.2029 at 9.40/45%, 01.10.2032 at 10.22/25%, 01.11.2033 at 10.37/42%.

Sri Lanka's rupee weakened to 309.45/50 per USD on Tuesday from 309.25/35, while government bond yields remained broadly steady. A 48,000 million rupee Treasury bill auction is scheduled for Dec 17 and the ASPI was up 0.15% at 22,328.

Secondary Treasury bond trading was subdued and yields consolidated after last week's rally, with the 01.06.26 at 8.30% and the 01.10.32 at 10.25%, and total secondary market Treasury volume of Rs.21.45bn on 12 Dec 2025. Net liquidity surplus fell to Rs.69.82bn, Rs.83.13bn was parked at the 7.25% SDFR, and USD/LKR closed at 309.25/309.35.

Sri Lanka will move a Rs500 billion supplementary estimate into next year’s budget to fund reconstruction after Cyclone Ditwah, which left over 800 dead or missing, damaged roads (RDA estimates Rs190bn) and destroyed 108,000 ha of paddy. The World Bank will repurpose $120m and the IMF has pledged $200m in fast-disbursing support.

The Cabinet approved Sri Lanka will co-host the 2026 Asian Regional Debt Management Conference at the end of May 2026. The ADB‑hosted event will bring debt managers, central banks and finance officials for workshops on public debt management, regional cooperation and capacity building.

Sri Lanka's GDP grew 5.4% in Q3 2025. Agriculture rose 3.6%, manufacturing 8.1% and services 3.5%, with insurance up 18%, financial services 13.2%, accommodation/food 9.3% and IT services 8.5%; central bank stability supported activity despite a weakening rupee.

The Sri Lankan rupee weakened to 309.25/35 per US dollar on Monday while government bond yields were largely steady (e.g., 15.12.2026 at 8.35/45%, 15.02.2028 at 8.97/9.00%, 15.06.2035 at 10.63/68%).

Sri Lanka's budget deficit halved to 455.8 billion rupees in the 10 months to October 2025, while the rupee depreciated to 304/USD and tax revenues rose 34% to 4,033 billion rupees. Current spending produced a 112.4 billion rupee current surplus to October, but year-end deficits are still projected.

Sri Lanka's rupee traded around 309.00/25 to the USD as bond yields were broadly steady (near-term yields ~8.95–9.40%, longer bonds up to ~10.65%), while the ASPI rose 0.18%.

Workers’ remittances in Jan–Nov 2025 surpassed $7.1 billion, aided by a November inflow of $673.4m (27% YoY). Remittances remain Sri Lanka’s largest source of foreign exchange and are the strongest Jan–Nov performance since 2016, supporting external finances.

Secondary bond market turned bullish as yields fell across the curve after strong Treasury bond auctions, news of IMF engagement and a 25bp US rate cut. T-bill yields were unchanged (91/182/364-day at 7.51%, 7.91%, 8.03%); longer-dated bond maturities were fully subscribed while 01.03.2030 raised Rs.20.88bn at a 9.55% weighted yield.

Deloitte Sri Lanka hosted the 'CFO Conclave 2025' to brief CFOs on key regulatory, reporting and governance changes. Sessions covered IFRS 18/19, the CA Sri Lanka Code of Ethics 2025, Companies (Amendment) Act No.12 on beneficial ownership, transfer-pricing and FX reforms, AI governance and an upcoming Deloitte CFO Pulse Survey 2025.

Worker remittances rose 27% to USD 673.4mn in November 2025 and reached USD 7.2bn in the first 11 months, up 20.7% y/y and surpassing the 2017 record. The increase follows the central bank ending a parallel exchange rate regime and the 2026 budget pledge of housing loans and a pension scheme for overseas workers.

Sri Lanka received USD 673.4 million in workers’ remittances in November 2025, taking cumulative Jan–Nov inflows to USD 7.19 billion, a 20.7% year-on-year increase.

Private credit in Sri Lanka rose to a record Rs246.1 billion in October 2025 (from Rs236.3bn in September) while credit to government fell and the rupee depreciated. Analysts warn central bank shifts in reserve and exchange-rate policy, monetisation and rising yields could pressure banks, reserves and inflation.

Central Bank Governor Nandalal Weerasinghe urged stronger research and collaboration to navigate overlapping global shocks, calling for building external reserves, restoring fiscal space, state-owned enterprise reform and a stronger, well-capitalised financial system.

Sri Lanka's rupee closed at 309.05/15 to the US dollar on Friday, slightly stronger than the prior day's 308.80/90, while government bond yields fell (e.g. the 15.02.2028 bond at about 8.95–9.00% down from 9.05/10%). The rupee is nevertheless weaker week-on-week (308.55/65 last Friday).

Sri Lanka's rupee was quoted at 309.05/15 to the US dollar, slightly firmer than 308.15/40 the previous day, while secondary-market government bond yields fell (e.g. 15.02.2028 yield quoted 8.93/98% vs 9.05/10%).

Treasury bond auctions took up the full Rs.100 billion offered in the first phase for the 01.10.2032 and 15.06.2035 maturities at weighted average rates of 10.29% and 10.67%, within pre-auction ranges. Secondary yields fell (2028–29 maturities hit intraday lows ~9.10–9.51%), net liquidity rose to Rs.109.54bn and USD/LKR weakened to 309.15/309.40.

Sri Lanka's rupee closed at 309.15/40 per USD, weaker than 308.80/90 the previous day; government bond yields were slightly down (e.g. 15.12.2026 at 8.30/40% from 8.34/44%, 15.02.2028 at 9.05/10% from 9.15/20%).

Weekly Treasury Bill yields held steady for a 21st week as the Rs.48 billion T‑Bill auction was fully subscribed; a Rs.143 billion Treasury Bond auction (2030, 2032, 2035 maturities) is scheduled today. Secondary bond activity moderated and USD/LKR spot weakened to 308.80/308.90.

The Sri Lankan rupee was quoted at 308.95/309.05 to the US dollar, slightly weaker than 308.80/308.90, while government bond yields fell (e.g. 15.02.2028 bond 9.05/15% vs 9.15/20%). The ASPI rose 0.78% to 22,596 and a Rs 143,000 million Treasury bond auction was ongoing.

Central Bank of Sri Lanka held the International Research Symposium (8–10 Dec 2025) to mark its 75th anniversary, hosting the 14th IRC, SAARCFINANCE Database Seminar and a CBSL‑ADB‑APAEA workshop focused on inflation, capital flows, credit dynamics and climate risks.

Sri Lanka's rupee closed at 308.80/90 to the US dollar, slightly weaker than 308.64/66 the previous day; government bond yields were broadly steady, with the 15.12.2026 at about 8.34/44% and the 15.02.2028 at about 9.15/20%.

Sri Lanka's rupee opened slightly weaker at 308.65/70 per US dollar and government bond yields were broadly steady, with 2028–2033 maturities quoted around 9.25%–10.55%. The ASPI rose 1.30% to 22,320 and an Rs 48,000 million Treasury bill auction was ongoing.

Secondary government bond yields fell as strong buying and news of a $200m IMF RFI request plus expectations of US rate cuts boosted demand; 15.02.28 traded at 9.20% and 2032/33 tenors saw ~10bp intraday drops. This comes ahead of a Rs.48bn T‑Bill auction (vs ~Rs.134.15bn maturing) and a Rs.143bn Treasury Bond auction on Dec 11.

External debt reached $37,238m at end‑Sept 2025, up $100m QoQ; Sri Lanka paid $1.36bn of the $2.45bn due in 2025 (55%), leaving $1.09bn for H2. Debt restructuring has advanced (ISB exchange ~98% participation; ~94% completion across creditors), enabling regular servicing and projected annual external servicing of ~$2.75bn to 2027 rising to $3.2–3.5bn thereafter.

Sri Lanka's rupee closed at 308.64/66 to the US dollar and government bond yields were mixed-to-lower; the 15-Dec-2032 note fell to 10.25/29% while the 15-Dec-2026 note was at 8.34/44%.

Sri Lanka's rupee was quoted at 308.63/67 to the US dollar and bond yields were broadly steady (15.02.2028 at 9.18/22%, 15.12.2029 at 9.60/70%, 15.12.2032 at 10.35/45%). Rs 48,000 million of Treasury bills will be auctioned on Dec 10; the ASPI rose 0.58% to 21,719.