ECONOMYNEXT – Foreigners investors bought Sri Lanka government securities in the week ended on December 19, after selling in the previous week, the Central Bank data showed.
The island nation saw foreign outflow from the government securities for the first time in 13 weeks in the week ended on December 12. However, the offshore investors bought Sri Lanka papers last week.
Sri Lanka has been maintaining deflationary policies and import curbs amid declining interest rates after the inflation hit record high of over 70 percent in 2022.
The last week’s inflow came after the island nation’s conclusion of commercial and International Sovereign Bond (ISB) debt restructuring.
Sri Lanka saw 506 million rupees ($1.7 million at 1 US dollar = 290 LKR) inflow into government securities in the week ended on December 19. The government has seem total inflows of 27.2 billion rupees ($93.8 mln) into treasury bonds and bills in the 14 weeks through December 19, the official data showed.
The value of government securities held by foreign investors was at 66,556 million rupees by December 19.
Analysts say Sri Lanka’s deflationary policies have helped to see inflows amid curtailed imports.
The President Anura Kumara Dissanayake’s party has pledged to end deep-rooted systematic corruption in Sri Lanka. The island nation has not changed its economic policy directions since Dissanayake was elected.
The Central Bank data show foreign investors held 117.4 billion rupees worth of government securities at the start of 2024. However, Sri Lanka suffered a foreign outflow of 66 percent or 78.1 billion rupees worth government securities in the first nine months of this year. (Colombo/December 23/2024)
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