Sri Lanka's foreign reserves climb 3.4% as Central Bank intervenes in forex market

Sri Lanka's foreign reserves rose 3.4 percent during October 2026, according to latest data, as the Central Bank continued its dollar accumulation strategy. The reserve buildup underscores the monetary authority's commitment to rebuilding forex buffers following previous external pressures on the nation's balance sheet.

The Central Bank's deliberate purchase of dollars in the forex market has emerged as a key policy instrument in recent months. These interventions aim to support exchange rate stability while gradually augmenting the country's reserve position, which remains critical for servicing external obligations and maintaining macroeconomic stability.

The October increase follows a broader trajectory of reserve accumulation, reflecting improved foreign currency inflows and better-managed capital flows. Stronger export earnings and remittance receipts have contributed to the positive momentum, alongside strategic Central Bank actions.

Reserve adequacy remains a focus area for policymakers as Sri Lanka continues its economic stabilization program. The gradual restoration of forex buffers is viewed as essential for supporting confidence in the rupee and reducing vulnerability to external shocks in the coming months.