Central Bank Snaps Up $70.5 Million in June as Rupee Holds Steady

Sri Lanka's Central Bank purchased a net US$70.5 million from the domestic foreign exchange market during the month of June, reflecting continued efforts to rebuild the country's reserve buffers as the rupee maintains a period of relative stability.

Steady Accumulation in the First Half of 2026

The June purchase adds to a broader pattern of aggressive reserve accumulation that has characterized the Central Bank's market operations in recent months. For the first six months of 2026, the bank has recorded a cumulative net purchase of US$556.4 million, underscoring its determination to strengthen the country's external position following years of economic turbulence.

This momentum builds on an even more substantial effort carried out throughout 2025, during which the Central Bank made a net purchase of approximately US$2 billion from the foreign exchange market — a figure that marked one of the most significant reserve-building exercises in the country's recent financial history.

What This Means for the Rupee

The Central Bank's ability to consistently purchase foreign currency from the market without triggering sharp depreciation of the rupee is widely seen as a positive signal. It suggests that supply in the domestic foreign exchange market has been sufficiently healthy to absorb institutional buying, while the local currency has held its ground.

A stabilising rupee is of considerable importance to Sri Lankan households and businesses alike, as exchange rate volatility in recent years contributed significantly to surging import costs, fuel shortages, and broader inflationary pressures that defined the island's economic crisis.

Rebuilding Reserves After the Crisis

Sri Lanka's foreign reserves collapsed to critically low levels during the 2022 economic crisis, leaving the country unable to finance essential imports. The subsequent recovery programme, supported by the International Monetary Fund, placed strong emphasis on rebuilding reserve adequacy as a cornerstone of macroeconomic stability.

The sustained pace of net purchases across 2025 and into 2026 indicates that the Central Bank is making meaningful progress toward that goal. Analysts note that maintaining this trajectory will be essential as the country continues its engagement with international creditors and seeks to restore confidence among foreign investors.

• Net purchase in June 2026: US$70.5 million
• Net purchase in first half of 2026: US$556.4 million
• Net purchase in full year 2025: US$2 billion

The Central Bank has not issued a detailed public commentary accompanying the latest figures, but market observers regard the continued buying activity as a sign that policymakers remain committed to shoring up the country's external buffers well into the second half of the year.