CBSL to announce daily dollar/rupee trading band

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The Central Bank of Sri Lanka (CBSL) has taken steps to introduce new regulations aimed at curbing some of the misconduct of exporters in the Sri Lankan foreign exchange market, CBSL Governor Nandalal Weerasinghe said yesterday (11).

“Exporters were asking banks to sell part of the dollars to third parties at higher prices, which is against regulations. This is to import non-essential consumer goods. This is against our regulations. We are bringing in new regulations to prevent this situation,” he said, speaking at a Media briefing.

Therefore, the CBSL will announce a daily trading band for the rupee/dollar exchange rate based on the previous day’s price and a plus or minus margin.

He said from now on, exporters and importers will be able to trade in the foreign exchange market with a more transparent policy.

Sri Lanka currently receives over US$ 1 billion in export earnings, but more than 50% of it is reimbursed for their import requirements.

Due to this, the Central Bank is facing difficulties in obtaining foreign exchange for the country’s essential imports.

By Ishara Gamage