News & market updates

Sri Lanka's rupee opened weaker at 310.00/25 per US dollar. Bond yields were broadly steady (mid-dated yields around 9–10%), a Rs 120,000 million T-bill auction was ongoing, and the ASPI rose 0.70% to 22,603.

Spot gold rose 0.8% to $4,364.70/oz, extending a 66% gain in 2025 and positioning it for its biggest annual rise since 1979. Traders cited interest-rate outlook, geopolitical risks and central bank/ETF demand as key drivers.

Sri Lanka's interest rates edged up through 2025, reducing the risk of a second sovereign default; the prime lending rate rose to about 8.94% by December while the policy rate stood at 7.75% after a May cut. Reserve collections missed projections and the rupee depreciated, analysts warn.

Aggregate profits of 273 listed companies fell 12% YoY to Rs.176.5 billion in Sep-25, ending a seven-quarter growth streak. Banks (Rs.52bn, +39% YoY) and diversified financials (Rs.39bn, +112% YoY) underpinned a QoQ rebound, while food, beverage & tobacco and capital goods posted steep declines.

Cabinet approved a Rs.5 billion 'Comprehensive Disaster Relief Loan Scheme' offering working-capital loans at 3% p.a. through licensed commercial and specialised banks, effective 1 Jan 2026. Loans range from Rs.250,000 for micro entrepreneurs to Rs.25 million for large firms, repayable within three years with a six-month grace period and no collateral.

A government bond auction raised Rs.43.18bn (78.51%) of the Rs.55bn offered, with the 01.07.37 maturity fully subscribed at a weighted average yield of 10.90%. Money market liquidity rose to a Rs.124.26bn surplus and a Rs.120bn weekly T‑bill auction is scheduled; USD/LKR traded around Rs.310.

Sri Lanka’s 2025 combined IMF-backed stabilization and reform gains with a late-November setback from Cyclone Ditwah. Key items include a Central Bank rate cut (lending window to 8.25%), DFCC’s sale of a 50% Acuity stake to HNB for LKR 6.5bn, and John Keells launching the $1.2bn City of Dreams resort alongside major energy project deals and rooftop-solar grid issues.

Sri Lanka's rupee closed weaker at 310.00/310.20 to the US dollar (from 309.85/309.95) while government bond yields were broadly steady; an auction sold Rs43.18bn of 2030 and 2037 bonds and a Rs120bn T-bill auction is due Dec 31.

Sri Lanka's cabinet approved a 5 billion rupee programme to provide cyclone recovery loans at 3% interest through commercial banks. Micro businesses can get up to 250,000 rupees, small businesses 1 million and larger firms up to 25 billion, with a three-year repayment and six-month grace.

Sri Lanka sold Rs43.18bn of government bonds: Rs18.18bn of the 01 Jul 2030 at an average yield of 9.80% and Rs25.00bn of the 01 Jul 2037 at an average yield of 10.90%, from an offer of Rs50bn; the 2030 bond is available on tap.

Sri Lanka's Securities and Exchange Commission is exploring introducing infrastructure and municipal bonds to fund reconstruction and public projects, with a proposal submitted and talks planned with selected municipal councils. The SEC said bonds would be raised project-by-project and open to small investors, but weak municipal creditworthiness and post‑crisis risks remain.

Sri Lanka's rupee weakened to 309.99/310.00 against the US dollar from 309.85/95, while bond yields remained broadly steady; a Rs 55,000mn Treasury bond issue is ongoing and a Rs 120,000mn T-bill auction is due Dec 31. Local indices were up (ASPI +0.54%).

Central government debt rose by 936 billion rupees to September 2025—more than double the 441 billion-rupee budget deficit—with foreign debt up 545 billion rupees to 18,974 billion amid 2025 rupee depreciation. Analysts pointed to central bank policy, a May rate cut and Treasury dollar operations as contributing factors.

Secondary Treasury bond yields swung—initial declines reversed by profit-taking—closing slightly above opening as markets await today's Rs.55 billion auction (Rs.30bn 01-Jul-2030 coupon 9.75%; Rs.25bn 01-Jul-2037 coupon 10.75%); USD/LKR closed at 309.85/309.95.

Foreign investors sold a net USD 5.06m (1,545 million rupees) of Sri Lanka government securities in the week to Dec 24, reversing the prior week's inflows and reducing foreign holdings from a near two‑year high.

Sri Lanka's rupee closed weaker at 309.85/95 per US$ (from 309.65/75), and government bond yields moved up: 15.12.2026 at 8.40–8.70%, 15.02.2028 at 9.00–9.06%, 15.12.2029 at 9.70–9.75%, 01.10.2032 at 10.30–10.35%, and 01.11.2033 at 10.50–10.60%.

Sri Lanka recorded 16,039 new active credit cards in October 2025, bringing total active cards to 2,133,417 (a 0.76% month-on-month rise) as economic recovery and lower interest rates supported increased card usage.

Sri Lanka's rupee was quoted at 309.60/75 to the US dollar, broadly unchanged from Friday, while short‑end government bond yields eased; the Treasury has a Rs 55,000 million bond auction on Dec 30 and a Rs 120,000 million T‑bill auction on Dec 31.

Secondary bond yields closed higher week‑on‑week after the weekly T‑Bill auction pushed weighted average rates up across maturities (364‑day +16bp); the Rs.150bn T‑Bill offer was 54.97% subscribed (Rs.82.45bn raised). Foreign holdings fell by Rs.1.55bn and money‑market liquidity rose to Rs.111.66bn; USD/LKR closed near 309.70.

S&P Global says global credit conditions should remain resilient into 2026, supported by steady growth, easing interest rates and investor demand, but warns of uneven sector outlooks and risks from potential overinvestment in AI-driven data centres. It forecasts 3.2% global growth and a US speculative-grade default rate easing to 4% by Sept 2026.

Fitch Ratings says global private credit will continue to grow in scale and complexity in 2026, with closed-end funds and business development companies projected to reach $2.3tn AUM at end-2025. Fitch views risks as not currently systemic but notes potential transmission via insurers and banks, and that interest-rate cuts should ease borrower stress and reduce defaults.

Vehicle sales in Sri Lanka fell about 50% after Cyclone Ditwah, and auto importers are seeking relief from a 3%/month penalty on vehicles unsold after three months, requesting a six-month extension. Importers say they face ~10% loan interest, declining import volumes and rupee volatility.

E.B. Creasy invested Rs. 500 million in its subsidiary Darley Butler by buying 2,393,490 shares at Rs. 208.90 each on 24 December to allow DBCL to settle short-term interest-bearing borrowings, reduce interest expenses and improve its gearing and the Group’s consolidated balance sheet.

At SLABA's flagship forum, apparel industry leaders warned the sector is on fragile stability and urged immediate structural reforms to boost exports and productivity; speakers cautioned exchange-rate volatility, interest-rate risk and weak domestic demand could force macro adjustments.

Sri Lanka's overall budget deficit fell 73% to Rs325 billion and revenues rose 35.5% to Rs4,945 billion, producing a budget current account surplus of Rs204 billion to November. The central bank has run broadly deflationary policy amid a weakening rupee and concerns over its 5% inflation target.

JB Securities analysis: premium vehicles costing up to LKR 200–300 million, including a pre-owned Bentley Continental GT, Ferrari 296 GTB and Mercedes‑Maybachs, were registered in Sri Lanka in November 2025; about two‑thirds of their street value accrues to the government as taxes. Year‑to‑date JB data shows 5 used Bentleys, 1 Rolls‑Royce, 10 used Porsches, 2 Ferraris, 2 Lamborghinis and 6 new Porsches registered.

Sri Lanka sold Rs1,006 million of treasury bills on tap at average rates of 7.95% (6-month) and 8.19% (12-month), bringing total bills sold this week to Rs83.46 billion; settlement date was Dec 26.

Sri Lanka's rupee closed flat at 309.65/75 to the US dollar while local government bond yields fell across several maturities (e.g., the 15.03.2028 bond at 8.95/9.05%).

Sri Lanka's rupee was quoted at 309.70/80 to the US dollar, slightly weaker than 309.65/75, while government bond yields fell — e.g. 15.03.2028 ~9.06/11% (from 9.10/18%), 15.09.2029 9.60/65% (from 9.70/80%), 01.07.2030 ~9.75/80% (from 9.90/95%).