February 03, Colombo (LNW): The Sri Lankan rupee saw a 1.7 per cent depreciation against the US dollar in January 2025, following a notable 10.7 per cent appreciation over the course of 2024, according to the Central Bank of Sri Lanka (CBSL).
Whilst the rupee had experienced a significant gain throughout the previous year, the early part of 2025 saw it face challenges as it weakened not only against the US dollar but also against several other major international currencies.
This movement reflects broader global market trends, with fluctuations in cross-currency values contributing to the rupee’s decline during the month.
On a more positive note, despite the depreciation in nominal terms, the Sri Lanka rupee’s real effective exchange rate (REER 24), which measures the rupee’s value against a basket of 24 currencies, showed a marked appreciation.
The REER 24 index, which stood at 70.2 at the end of 2023, rose to 76.7 by the end of 2024.
This indicates an improvement in the overall purchasing power of the rupee internationally, though it also points to a decrease in Sri Lanka’s external competitiveness during this period.
