Sri Lanka eased restrictions on the foreign-exchange market to allow companies and individuals to send more dollars abroad. The rupee weakened a 15th day.
(Bloomberg) — Sri Lanka eased restrictions on the foreign-exchange market to allow companies and individuals to send more dollars abroad. The rupee weakened a 15th day.
Local companies would be allowed to transfer as much as $100,000 to set up or expand an overseas business, effective for six months starting from June 28, the central bank said in a statement on its website late Monday. The rupee fell 0.4% to 330.37 per dollar on Tuesday.
Colombo Stock Exchange-listed firms would be allowed to remit as much as $200,000 to expand an overseas office while the limit on remitting funds for working capital of overseas branches was increased to $30,000 from $15,000.
The relaxation on controls were made considering “the current and expected developments in the domestic FX market and with a view to further facilitate international transactions,” the central bank said.
Sri Lankan monetary authorities are steadily loosening the severe limits on the FX market as the Southeast Asian economy emerges from its worst crisis in decades. The measures suggest they are not worried about the weakness in the currency, which had slid about 7% this month to become the worst performer in Asia.
Other measures include:
- Limit on capital transaction remittances through business foreign currency accounts was raised to $100,000 from $20,000
- Limits on individuals migrating abroad for the first time was increased to $50,000 from $30,000
–With assistance from Malavika Kaur Makol.
(Updates with rupee drop on Tuesday)
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