The Central Bank of Sri Lanka (CBSL) has reported a significant inflow of $548.1 million in workers’ remittances for February 2025. This brings the total remittance inflow for the first two months of the year to $1.12 billion, reflecting a notable 16.3% increase compared to the $963.7 million received during the same period in 2024.
The surge in remittances underscores a positive trend in foreign exchange inflows, which play a crucial role in supporting Sri Lanka’s economy. In 2024, the country recorded a total of $6.57 billion in workers’ remittances, a key contributor to its foreign reserves and external stability.
Meanwhile, Sri Lanka’s official reserve assets also saw a marginal increase, reaching $6.095 billion by the end of February, marking a 0.5% rise from the $6.065 billion reported in January. According to the CBSL, this uptick was primarily driven by foreign currency reserves, which climbed by 0.7% to $6.031 billion from $5.986 million in the previous month.
In addition to remittances, the CBSL made a net purchase of $70.3 million from the domestic foreign exchange market in February. This brought the total net purchases for 2025 to $80.6 million. The regulator has committed to net purchases exceeding $2.6 billion over 14 months as part of efforts to meet foreign reserves targets under the International Monetary Fund (IMF) programme.
According to the IMF staff report, Sri Lanka aims to achieve a 3.2-month import cover with foreign reserves of $7.056 billion by the end of 2025. In 2024, the Central Bank recorded the highest-ever net foreign exchange purchases of $2.8 billion, reflecting ongoing efforts to rebuild gross international reserves through outright foreign exchange purchases in the market.
Sri Lanka’s gross official reserves stood at an estimated $6.095 billion at the end of February, including proceeds from the Chinese swap arrangement. Despite these efforts, the Sri Lankan rupee has depreciated by 1% against the US dollar as of March 7, 2025.
