Merchandise trade deficit narrowed to US dollars 495 million in September 2021, compared to US dollars 525 million in September 2020. Earnings from exports continued to record values in excess of US dollars 1.0 billion for the fourth consecutive month in 2021 while import expenditure remained at almost the same level as in September 2020. Tourist arrivals continued the growth momentum with a notable increase over the previous month. A moderation of workers’ remittances was observed in September 2021. The financial account of the balance of payments strengthened during the month with the receipt of the proceeds of the syndicated loan facility from the China Development Bank (CDB) and remaining proceeds of the bilateral currency swap arrangement between the Central Bank of Sri Lanka and the Bangladesh Bank. Meanwhile, the weighted average spot exchange rate in the interbank market appreciated and stabilised during the month with action by the Central Bank to clear the backlog of shipments of essential imports and guidance on the exchange rate.

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