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Sri Lanka mid-June forex reserves at US$7.6bn: Central Bank

COLOMBO (EconomyNext) – Sri Lanka’s official foreign reserves have recovered to 7.6 billion US dollars by June 22, 2015 from 6.850 billion at the end of May, the Central Bank said.

The foreign reserves were equal of 4.6 months of imports.

The reserves haven been boosted partly with the help of a swap with India.

Sri Lanka sold a 650 million US dollar sovereign bond and 338 million US dollars in floating rate bonds to the domestic market in June.

Analysts believe a part of the bond proceeds had been converted but with state subsidies and salaries going up, and interest rates kept low with liquidity releases, a consumption boom has been fired, which is hitting the balance of payments.

June is also usually a month where there is spike in state foreign debt settlements.

The state sold another 327 million dollars of floating rate notes on Thursday which has a June 29 settlement date, which will analysts say will help make forex reserve numbers look better.