LKR appreciates 0.2% in January

The Sri Lankan Rupee, despite experiencing a depreciation observed by the dynamics in the last year (2025), has recorded an appreciation of 0.2% against the US Dollar in January this year, according to The Budget, Economic and Fiscal Position 2026 report, compiled by Verité Research, a Colombo-based think-tank.

According to the report, from January to October 2025, despite an improved current account position, the rupee weakened against global currencies, depreciating by 16% against the Euro, 10.2% against the Pound Sterling, 6.6% against the Japanese Yen, and 6.2% against the Chinese Yuan. 

In January, the rupee continued to depreciate against most major currencies, with the exception of the US Dollar and the Indian Rupee. Due to the US Dollar depreciation against major global currencies, the rupee’s depreciation against the US Dollar was only around 3.3%, and recorded marginal appreciations against the Indian Rupee both around 0.4%, the statement added.

The Budget, Economic and Fiscal Position 2026 report projected the “exchange rate is expected to be stable in 2026”. According to the data, for the year of 2025, the expected resumption of external debt repayments which will create additional pressure on foreign exchange flows is important for macroeconomic planning to have a clear analytical outlook on exchange rate movements in 2026. 

Based on historical exchange rate trends, the two currencies and the expected pressures from the country’s external financing requirements, Verité Research expects the rupee to depreciate by at least 4% against the US Dollar in this year, they said in the Budget statement report.

Meanwhile, The Central Bank of Sri Lanka (CBSL) stated, the Sri Lankan Rupee depreciated by 5.6% against the US Dollar in 2025. However, the rupee had appreciated by 12.1% against the dollar in 2023 and 10.7% in 2024.

Source - The Morning