📈 Foreign Investors Exit Sri Lanka Rupee Bonds for 3rd Straight Week

Foreign investors recorded net sales of Sri Lankan rupee-denominated government securities for the third consecutive week ending November 5, 2026, according to Central Bank data. • Key Outflows & Net Positioning: • Weekly Outflow: Net foreign selling reached Rs. 6.075 Bn (US$ 218.4 Mn) in the week ended Nov 5. • 5-Week Trend: Total net foreign outflows totaled Rs. 28.5 Bn over the past five weeks, marking net selling in 5 of the last 21 weeks. • Year-to-Date (YTD): Cumulative net foreign inflows stand at Rs. 43.6 Bn so far this year (following net inflows of Rs. 71.5 Bn in 2025). • Macroeconomic Context & Factors: • Global Drivers: Exits coincided with political shifts from the U.S. mid-term elections and geopolitical developments in the Middle East impacting global risk appetite. • Exchange Rate & Inflation: The Sri Lankan rupee has depreciated 6.7% YTD through Nov 6, driven by higher oil and vehicle imports. • Policy Response: The Central Bank executed a 100 bps rate hike in May to curb inflationary pressures following fuel price increases, stabilizing the rupee after a prolonged period of steady policy.