The momentum in export earnings continued with over US$1.0 billion for the ninth consecutive month in February 2022.
Meanwhile, import spending also increased substantially in February 2022, year-on-year, while registering a decline from the previous month.
The trade deficit widened compared to the previous year. Tourist arrivals showed a notable recovery in February 2022 compared to the same month of the previous year.
Workers’ remittances continued to moderate in February 2022. Foreign investment on the Colombo Stock Exchange (CSE) saw a sharp inflow during the month.
The weighted average spot exchange rate in the interbank market hovered around Rs. 202 per US dollar in February 2022.
However, the Central Bank allowed a measured adjustment in the exchange rate in the first week of March 2022, given increased pressures on the exchange rate amid low liquidity in the domestic foreign exchange market, leading to an overshoot. subsequent market forces beyond the level of depreciation expected in the measured adjustment.
The trade account deficit widened to US$781 million in February 2022 from a deficit of US$572 million recorded in February 2021.
However, on a monthly basis, the trade deficit narrowed in February 2022 from the US$859 million recorded in January 2022. Meanwhile, the cumulative trade account deficit from January to February 2022 widened to US$1,640. million US dollars against 1,227 US dollars. million recorded over the same period in 2021.
The ratio of export price to import price deteriorated by 10.7% in February 2022 compared to February 2021, as the increase in import prices exceeded the increase in export prices.
Merchandise export receipts in February 2022 increased by 14.7% compared to February 2021, recording $1,092 million. An increase in income was observed in industrial exports and mineral exports, while a decrease was observed in agricultural exports. Cumulative export earnings, which increased by 16.1% between January and February 2022 compared to the same period last year, amounted to 2,192 million US dollars.