The external current account recorded a surplus of US$ 133 million in August 2026 following four consecutive months of deficits. The surplus was supported by the lower trade deficit compared to recent months, reflecting lower import expenditure. The current account recorded a cumulative deficit of US$ 291 million during January-August 2026, reflecting pressures on the external sector stemming from the escalation of the Middle East conflict.
On a year-on-year basis, the merchandise trade deficit widened in August 2026, driven by higher import expenditure and lower export earnings. Meanwhile, the cumulative trade deficit widened to US$ 7.2 billion during January–August 2026, compared to US$ 4.3 billion in the corresponding period of 2025.
Monthly fuel import expenditure declined for the fourth consecutive month in August 2026. Cumulative fuel import expenditure amounted to approximately US$ 4.0 billion during January–August 2026, recording a 61.6% (year-on-year) increase compared to the corresponding period of 2025.
Expenditure on motor vehicle imports, including both personal and commercial vehicles, amounted to US$ 189 million in August 2026, recording a 24.2% decline compared to August 2025. Meanwhile, cumulative expenditure on motor vehicle imports amounted to US$ 1,684 million during January–August 2026.
The terms of trade deteriorated on a year-on-year basis in August 2026, as import prices increased at a faster pace than export prices. Similarly, the terms of trade deteriorated during January–August 2026 compared to the corresponding period of 2025.
The services account recorded a surplus of US$ 220 million in August 2026, a 24.4% reduction compared to August 2025. With the continued moderation in the monthly services account surplus, the cumulative services account surplus declined by 21.4% to US$ 2.1 billion during January-August 2026 on a year-on-year basis.
Tourist arrivals declined by 3.3% year-on-year in August 2026. Total arrivals during January-August 2026 declined by 2.0%, compared to the corresponding period of 2025. Meanwhile, tourism earnings were estimated at US$ 264 million in August 2026, reflecting a 2.1% increase from a year earlier. Cumulative tourism earnings during January-August 2026 declined by 10.0% to US$ 2.1 billion, compared to the corresponding period of 2025.
Workers’ remittances increased by 10.0% year-on-year to US$ 749 million in August 2026. Consequently, cumulative remittances during January-August 2026 rose by 19.8% on year-on-year basis to US$ 6.1 billion.
Foreign investment in the government securities market recorded a net inflow of US$ 70.2 million, while foreign investment in the Colombo Stock Exchange (CSE), including both primary and secondary market transactions, recorded a net outflow of US$ 58.1 million during August 2026.
Gross official reserves (GOR), including the swap facility with the People’s Bank of China (PBOC), increased to US$ 6.9 billion by end August 2026, supported by foreign exchange purchases by the Central Bank.
By end September 2026, the Sri Lanka rupee depreciated by 6.3% against the US dollar on a year-to-date basis.
