Sri Lanka forex reserve edge up in March

May 27, 2010 (LBO) – Sri Lanka foreign exchange reserves rose to 5,192 million US dollars in March 2010 from 5,032 million dollars a month earlier, with imports and remittances also expanding, the Central Bank said. Sri Lanka’s has a pegged exchange rate and foreign remittances as well as net foreign borrowings of the state help drive the trade deficit.

Reserves including the balance of Asian Clearing Union, a regional arrangement involving non-convertible currencies were at 5,294 million US dollars.

The official reserves were equal to 5.5 months of past imports the central bank said. Sri Lanka’s external trade has picked up in recent months and the trade deficit widened to

Sri Lanka’s foreign reserves fell to 5,032 million US dollars in February 2010 from 5,135 million US dollars in January, which was equal to about 5.5 months of past imports, the Central Bank said.

Sri Lanka’s trade deficit expanded 9.3 percent to 427.9 million US dollars in March from a year earlier. In the first quarter the trade deficit increased 119 percent to 1.46 billion US dollars.

Foreign remittances from Sri Lankan’s working abroad increased 14.1 percent to 891 million US dollars in the first quarter from a year