📈 Rupee Weakens Against US Dollar as Spot Market Trades Above Rs. 328

• Exchange Rate Movements: The Sri Lankan rupee weakened in the spot market, with the indicative exchange rate closing at Rs. 326.92 per dollar compared to the previous close of Rs. 325.62. Spot contracts traded within a higher range of Rs. 327.85 to Rs. 328.90 during the session (up from Rs. 326.50 to Rs. 327.50 previously). • Year-to-Date Performance: As of May 18, the rupee has depreciated by approximately 4.8% against the US dollar. However, official statements note this decline remains lower than that of several regional economies. • Key Drivers of Depreciation: Global factors: Escalating Middle East tensions, rising global oil prices, and overall global uncertainty leading to a stronger US dollar. Domestic factors: Heightened importer demand for foreign exchange, delayed conversion of export earnings, and market speculation. • Policy Stance: The Central Bank of Sri Lanka continues to maintain a flexible exchange rate policy, leaving the currency's value to be determined by market demand and supply dynamics.