Sri Lanka's Currency May Strengthen to 320 by Year-End

COLOMBO (News 1st); Sri Lanka’s rupee is expected to stage a moderate recovery by the end of 2026, supported by declining global oil prices and tighter monetary policy, according to projections by BMI, a research unit of Fitch Solutions.

The currency, which has faced downward pressure in recent months, is forecast to strengthen to around 320 against the US dollar, reflecting a gain of over three percent from its current level.

Analysts attribute the expected rebound largely to easing external pressures, particularly from the energy market, which has long weighed on the country’s import costs and foreign reserves.

Carolyn Pang, a Singapore-based country risk analyst at BMI, noted that a sustained drop in oil prices would significantly ease Sri Lanka’s financial burden, helping to stabilise the balance of payments.