The central bank started to collect foreign reserves after floating the currency in March which ended a period of liquidity injections (money printing) and peg defence, which reversed a cycle of expansionary sterilized intervention.
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At the height of intervention foreign reserves dipped to around a billion US dollars from 3.
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5 billion when interventions began.
In July Sri Lanka also received the first tranche of a 2.6 billion US dollar International Monetary Fund loan and later a distribution of IMF's special drawing rights.
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But most of the reserves were collected from the market by reversing a cycle of sterilized interventions following the float. Sterilizations are now contractionary.