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Sri Lanka's forex reserves fell to 7.261 million US dollars in January 2015, from 8.208 million US dollars in December 2015,official data showed.
The Island’s foreign reserves were up in August 2014 at 9.2 billion US dollars amid weak credit growth and since then it was falling steadily as domestic credit picked up.
According to analysts, the Central Bank would mop up excess liquidity in the banking system permanently and allow the market interest rates to move up if the foreign reserves are to be safeguarded.
The interim budget 2015, which raised public sector salaries from February is also expected to boost consumption and put pressure on the credit system.
The Island’s foreign reserves were up in August 2014 at 9.2 billion US dollars amid weak credit growth and since then it was falling steadily as domestic credit picked up.
According to analysts, the Central Bank would mop up excess liquidity in the banking system permanently and allow the market interest rates to move up if the foreign reserves are to be safeguarded.
The interim budget 2015, which raised public sector salaries from February is also expected to boost consumption and put pressure on the credit system.
