Middle East Conflicts Behind Rupee Depreciation, Says IMF

29-May-2026

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Head of Mission for Sri Lanka at the International Monetary Fund (IMF), Ivan Papageorgiou, has stated that Sri Lanka’s debt sustainability remains vulnerable and that the recent depreciation of the Sri Lankan Rupee was mainly driven by the ongoing conflicts in the Middle East and the resulting increase in global prices of fuel and other commodities. He further noted that the Sri Lankan authorities have already implemented appropriate temporary measures to stabilise the situation.

The IMF Executive Board approved the fifth and sixth reviews of Sri Lanka’s Extended Fund Facility (EFF) programme on 27 May. With this approval, Sri Lanka is set to receive an additional US$695 million in funding. In this context, the IMF organised a special virtual media briefing to explain its assessment of Sri Lanka’s current economic situation.

Responding to questions raised by journalists during the briefing, Ivan Papageorgiou elaborated on the IMF’s observations regarding the country’s economic outlook.