Inflation ( CCPI)1.7% (June 2024)
GDP5.3% (1Q 2024)
Unemployment4.3% (4Q 2023)
3M T-Bill Rate9.14%
12M T-Bill Rate9.95%
2Y T-Bond Rate10.10%/ 10.20%
4Y T-Bond Rate11.60% / 11.70%
USD/LKR303/304
Reserves $5.6Bn (June 2024)
Cum. Trade Deficit $2,180 Mn (May 2024 cumulative)
Cum. Fiscal DeficitLKR 361Bn (April 2024)

Majority expect LKR to deprecate bit more and settle between 320 to 340 by end of October

Opinion pollsOct 1, 2023
Majority expect LKR to deprecate bit more and settle between 320 to 340 by end of October

Due to the seasonal damage to import, sentiment damage due to the delay of the IMF staff-level agreement along with the USD 311Mn second tranche may put pressure exchange to deprecate from the current level of 322-325.

At the same time, the foreign currency inflow from tourism and worker remittance is expected to improve further and help LKR to stabled and control the magnitude of the depreciation.

The current economy does not have the capacity to import large goods like three years back as domestic demand is been slashed and buying power is lower.

Disclaimer

Charts represents an assessment of the market environment as of the date indicated and it is subject to change; and is not intended to be a forecast of future events or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice regarding the funds or any issuer or security in particular. The strategies discussed are strictly for illustrative and educational purposes and should not be construed as a recommendation to purchase or sell, or an offer to sell or a solicitation of an offer to buy any security. There is no guarantee that any strategies discussed will be effective.

The information presented does not take into consideration commissions, tax implications, or other transactions costs, which may significantly affect the economic consequences of a given strategy or investment decision. This document contains general information only and does not take into account an individual’s financial circumstances. An assessment should be made as to whether the information is appropriate in individual circumstances and consideration should be given to talking to a financial advisor before making an investment decisions.