With the record depreciation of the Sri Lankan Rupee against the US Dollar last Friday (04 September) the prices of all imported good will increase while foreign earnings too would increase, point out economic analysts.

This is likely to affect the prices of all imported goods to Sri Lanka, from food items to other products.

However, the depreciation of the Rupee would increase the export earnings of all sectors.

An entrepreneur in the tea industry had this to say; “There are likelihoods of the earnings in the tea industry growing in the future due to the depreciation of the Rupee. By now, our tea industry is in dire straits due to the crises in Russia and the Mid East. Under such circumstances, our export earning increasing is somewhat of a consolation.”

The Sri Lankan Rupee showed a significant depreciation against the US Dollar in the money market last Friday when the Central Bank allowed it to float without its intervention. At close of market last Friday (04 September) the Rupee stood at nearly Rs. 138 as against the Dollar.

The Central Bank of Sri Lanka decided to stop its intervention in the foreign exchange market unless necessary.

Since China depreciated its Yuan on 11 August up to now, the Indian Rupee has depreciated by 3.9 per cent, the Malaysian Ringgit by 08 per cent and the Indonesian Rupiah by 4.5 per cent.