Sri Lanka’s external current account recorded a marginal surplus in March 2026 despite a widening trade deficit and declining services earnings, the Central Bank of Sri Lanka said.
According to the External Sector Performance Summary for March 2026, the current account recorded a slight surplus in March, supported by higher workers’ remittances and a lower primary income deficit. The cumulative surplus for the first quarter reached $531 million.
However, the merchandise trade deficit widened to $2.3 billion during the first quarter of 2026, up from $1.5 billion in the corresponding period of 2025, reflecting stronger import growth compared to exports.
The CBSL noted that fuel import expenditure rose by 74.7% year-on-year to $630 million in March, driven by increased prices and volumes linked to the ongoing Middle East conflict. Vehicle imports also remained high, amounting to $195 million in March and $613 million for the first quarter.
The services account surplus declined sharply by 42.4% to $227 million in March, mainly due to a drop in tourism earnings. Tourist arrivals fell by 19.8% year-on-year to 183,979, while earnings were estimated at $224 million for the month. Cumulative tourism earnings declined by 15% in the first quarter.
Workers’ remittances rose to $815 million in March, recording a 17.5% increase compared to a year earlier, with cumulative remittances growing by 26.5% during the first three months of the year.
Meanwhile, foreign investment flows remained negative, with net outflows of $64 million from the government securities market and $10 million from the Colombo Stock Exchange.
Gross official reserves stood at $7 billion at the end of March, including the swap facility with the People’s Bank of China. The decline in reserves during the month was mainly attributed to external debt servicing.
The Sri Lankan rupee had depreciated by 2.9% against the US dollar by end-April, amid external sector pressures following the onset of the Middle East conflict, the central bank said. (Newswire)