Sri Lanka: IMF demands currency devaluation

By Saman Gunadasa 
5 October 2011

The International Monetary Fund (IMF) last month delayed the final two instalments of its loan to Sri Lanka, demanding the devaluation of the rupee. After the IMF postponed the instalments, worth $US400 million each, due in June and December, Koshy Mathai, the fund’s residential representative said no timetable had been fixed for the completion of its review.

The IMF warned the government that another foreign reserves crisis loomed if it did not heed the request for a “flexible exchange rate.” The fund also pressed for further fuel price hikes and higher domestic interest rates.   Full Story>>>