Sri Lanka

Fitch Ratings has affirmed Sri Lanka’s Long-Term Foreign Currency Issuer Default Rating at ‘Restricted Default’ or ‘RD’.In a statement on Friday (Sept.

08), the global credit rating agency said the country’s reserves levels will influence the rating only once it has moved it out of ‘RD’. Despite an increase in reserves over the last nine months to around USD3.8 billion in July 2023, they remain well below the USD7.3 billion average over 2014-2019, Fitch said further.Fitch Ratings says the reserve dynamic among APAC (Asia-Pacific) sovereigns appears to be diverging, with potential implications for their credit profiles.The New York-based agency added that some central banks have been able to accumulate reserves on current account improvements or investment inflows, while others still see their currencies under pressure from US Fed tightening prospects.Official reserves among Fitch-rated sovereigns in APAC increased by almost USD 170 billion in the first half of 2023, mostly driven by growth among those with already large reserve buffers, including China (A+/Stable), Singapore (AAA/Stable), India (BBB-/Stable), Japan (A/Stable) and Taiwan (AA/Stable).

Strong external liquidity positions support these sovereigns’ credit profiles, but further reserve increases are unlikely to have much near-term influence on ratings.Several sovereigns in ASEAN, including Indonesia (BBB/Stable), Malaysia (BBB+/Stable), the Philippines (BBB/Stable) and Thailand (BBB+/Stable), saw reserves decline over 2Q23, which may in some cases reflect intervention to support currencies.

The changes have been marginal so far, not influencing credit profiles significantly, but currency pressure may continue until the Fed finishes raising rates.Reserve dynamics may have a greater impact for frontier market sovereigns, especially where reserve coverage ratios are low and external liquidity positions fragile.

In our most recent rating assessments, we stated that external finance factors, potentially including marked or sustained declines in foreign exchange reserves, could be a driver of negative rating action in sovereigns such as Bangladesh (BB-/Stable), the Maldives (B-/Negative), Mongolia (B/Stable) and Vietnam (BB/Positive).Official reserves have fallen by around 29% in the Maldives over January-July 2023, reversing the improvement in reserves in late 2022 following the conclusion of a USD 200 million bilateral currency swap with India.

Bangladesh improved reserve transparency with the adoption of IMF definitions in June.

IMF data show its reserves declined 31% over January-July, but we estimate the decline could be around 16% if the new definitions applied throughout the period.By contrast, reserves in Mongolia and Vietnam climbed over the first half of 2023.

Official reserves rose by 3% in Vietnam over January-May 2023 (most recent available data), after falling 21% in 2022.

The modest increase partly reflects a widening of the goods trade surplus in the first half of 2023, as weaker domestic demand has curbed imports, offsetting the effects of a continued contraction in exports.Fitch Ratings says at USD 3.9 billion in August, Mongolia’s reserves remain below the historic peak of USD 4.9 billion seen in the second quarter of 2021, but have risen significantly from their recent low of USD 2.7 billion in August 2022.

This partly reflects strong growth in exports over 2H22 and 1H23, as well as Mongolia’s USD 450 million bond issue and a USD 200 million exchange and tender offer in January 2023.

Larger reserve buffers should reduce Mongolia’s external financing vulnerabilities.

Nevertheless, these will still be significant in light of the country’s high net external debt burden and our projections for further current-account deficits in 2023-2025.Pakistan’s reserves have risen by around USD 3.8 billion in July after the country agreed to a nine-month Stand-by Arrangement with the IMF.

We upgraded Pakistan’s rating to ‘CCC’, from ‘CCC-’ in July, on the assumption that the IMF deal would catalyse other funding and anchor policy around the parliamentary elections.

A rebuilding of reserves and easing of external financing risks could increase upward pressure on Pakistan’s rating.

However, the political climate remains volatile and we view risks to IMF programme implementation and external funding as high amid Pakistan’s large external financing requirement.





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[Sri Lanka] - United States promises continued assistance to reinforce Sri Lanka s economy


[Sri Lanka] - Constitutional Council approves Acting IGP visit


Indian financial aid opens new chapter with Maldives


Chinese warship Po Lang docks in Colombo


[Sri Lanka] - Arrest warrant released against Upul Tharanga for failure to appear at court


Hopfield and Hinton win 2024 Nobel Prize in Physics


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Sri Lanka to reject UNHRC draft resolution, uphold local reconciliation efforts


[Sri Lanka] - Minister Vijitha Herath clarifies brand-new govt s foreign relations policy


[Sri Lanka] - Acting Commissioner General of Registration of Persons appointed


New Acting Commissioner General appointed to Excise Dept.


56 prisoners repatriated to Pakistan from Sri Lanka


[Sri Lanka] - Sri Lanka, Jordan check out commercial, investment prospects


[Sri Lanka] - Senior Professor Hareendra Dissabandara appointed SEC Chairman


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[Sri Lanka] - ? I put on t play favorites?- Jayasuriya promises objective management as Head Coach


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[Sri Lanka] - World Bank signs additional $200M to support Sri Lanka s economic reforms


[Sri Lanka] - NIE Director and school instructor even more remanded over scholarship exam paper leak


[Sri Lanka] - SLC validates Sanath Jayasuriya as nationwide group s head coach


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Colombo receives highest rains in last 24hrs


Easter attacks- Senior DIG Nilantha Jayawardena appears before SC


32-year-old lady passes away following attack in Keselwatta


Explosion outside Karachi airport eliminates 2 workers from China and hurts others


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[Sri Lanka] - Sri Lanka to begin details collection for census of population, housing


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[Sri Lanka] - 40 immigrants involved in online financial rip-offs detained


Acting IGP orders police to fix all small complaints within 2 weeks


[Sri Lanka] - President assures justice for Easter attacks victims


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56 Pakistanis held in Sri Lanka return home after years in detention


IRD collects over 70% of 2024 tax earnings target


[Sri Lanka] - Sri Lanka s tourist profits reach USD 181 million in September


Man eliminated in crocodile attack in Gemunupura


Special import levy on potatoes and big onions increased


Acting IGP praises police conduct during Presidential Election


Dozens of Pakistan authorities hurt in clashes with fans of former PM Khan


President receives blessings from Sacred Jaya Sri Maha Bodhi


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Public asked to report evidence on leaked questions in 2024 Scholarship Exam


PHIs issue notice over imported coconut oil


Lebanon hospitals close as Israeli strikes hit health facilities


New Director appointed to State Intelligence Service


[Sri Lanka] - President gets blessings from Chief Prelates of Amarapura and Ramanna Maha Nikayas


Will never allow Sri Lankan territory to be used inimical for India s security interests President


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Piriven O'L results released


IMF acknowledges Sri Lanka s progress, warns of ongoing vulnerabilities


33-year-old man stabbed to death in Colombo


Israel targets Hezbollah intel HQ in Lebanon, Iran says it will not back down


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Court further suspends Keheliya and family s assets worth Rs. 97 mn


India s Jaishankar gets in touch with President Dissanayake


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CSE s ASPI crosses 12,000 mark


Senior couple discovered murdered inside home in Ahangama


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Israeli airstrikes rock southern suburbs of Beirut and cut off a key crossing into Syria


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Bandula decides not to contest 2024 General Election


[Sri Lanka] - 2024 General Election- Accepting of nominations begins


[Sri Lanka] - Sri Lanka keen to step up co-operation in potential areas with Vietnam


Development of cops examinations into high-profile cases reviewed


[Sri Lanka] - Indian Foreign Minister Jaishankar arrives in Sri Lanka


UN assures support for Sri Lanka s IMF program and govt s poverty eradication efforts


[Sri Lanka] - President declares commitment to continuing IMF program without interruption


Health officials caution over spread of hand, foot and mouth disease amongst kids


UN Security Council backs Guterres after Israel bars him from nation


[Sri Lanka] - No Sri Lankans seriously affected by situation in Lebanon - MFA


Colombo HC defers hearing of Keheliya s corruption case


Singapore s disgraced former minister S. Iswaran imprisoned in landmark case


[Sri Lanka] - LG Elections to be held right after parliamentary polls


Two more detained over defamatory posters of Mannar HC Judge


Individual killed after being struck by train in Aluthgama


[Sri Lanka] - Anglers arrest- PMK to picket Sri Lankan Consulate in Chennai


Suspect detained with over 1.8 kg Kush marijuana at BIA


Israel strikes heart of Beirut, killing 6


[Sri Lanka] - High-level IMF delegation meets brand-new govt s financial team, discuss reforms


[Sri Lanka] - Praveen Jayawickrama banned under ICC Anti-Corruption Code


Parties that backed Ranil to contest basic election under Gas Cylinder sign


MPs who supported former President to contest under elephant symbol


[Sri Lanka] - China pledges full assistance for Sri Lanka s financial obligation restructuring and financial stability


Jaishankar to visit Sri Lanka on Oct 4 - reports


[Sri Lanka] - No reports of Sri Lankans in Israel impacted by Iran attacks - envoy


[Sri Lanka] - Australia guarantees support for Sri Lanka s IMF program


Oil prices jump more than 2% as Middle East tensions escalate


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Cuba agrees to provide expert knowledge for dengue control in Sri Lanka


Danish authorities examine 2 blasts near Israel s embassy in Copenhagen


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[Sri Lanka] - High-level IMF group to get here in Sri Lanka today


Freight container transportation charges reduced


[Sri Lanka] - ADB President declares dedication to deepening cooperation with Sri Lanka


Iran states attack on Israel is over as fears grow of broader conflict


Israel Military says missiles launched by Iran at Israel


Bangladesh sees fresh protests over increasing age limit for government jobs


Presidential Secretariat returns 19 cars to govt institutions


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UGC notice on accepting applications for university admission


TNA s Shritharan meets President Anura Kumara Dissanayake


ASPI jumps 137 points, nears 12,000 mark


[Sri Lanka] - Russian Ambassador contacts President; provides personal message from Putin


School bus catches fire in Thailand, 25 feared dead


Bus fares decreased


US Ambassador Julie Chung calls on President Dissanayake


Dhammika Perera re-appointed Co-Chairman of Hayleys PLC


Japan s parliament elects Shigeru Ishiba, recently chosen governing celebration leader, as prime minister


New Chairman designated to Litro Gas


President instructs to suspend Scholarship Exam paper marking for 2 weeks


Committee to evaluate advantages given to MPs, Ministers, and ex-presidents


Performing Controller General of Immigration and Emigration appointed


Duminda Hulangamuwa and Prof. Anil Fernando designated Senior Economic Advisors to President


Postal ballot applications for General Election accepted from today


We aim to recover cheerful, carefree youth every kid is worthy of President


Israel begins Lebanon ground invasion with minimal raids on Hezbollah





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