Sri Lanka’s trade deficit widens in October as imports rise
Sri Lanka’s merchandise trade deficit expanded year-on-year in October 2025, driven largely by a sharp increase in imports. Vehicle imports — including both personal and commercial categories — reached USD 261 million for the month, while cumulative vehicle imports for January to October totalled USD 1,465 million.
Reflecting a higher rise in import prices compared with export prices, the terms of trade deteriorated in October (year-on-year).
Trade in services posted a marginal increase in net inflows, reaching around USD 3.1 billion during January–October 2025.
The external sector recorded a current account deficit in October 2025 for the second consecutive month. However, the cumulative current account surplus for the first ten months of the year is estimated at around USD 1.7 billion.
Tourist arrivals rose in October on both a month-on-month and year-on-year basis. Tourism earnings also increased, though at a moderate pace, with cumulative earnings for the first ten months posting a 4.9% year-on-year rise.
Workers’ remittances recorded the highest monthly inflow since December 2020. On a cumulative basis, remittances for the first ten months of 2025 grew by 20.1% year-on-year.
Foreign investments in the government securities market continued to show net inflows in October, while foreign investments in the Colombo Stock Exchange (CSE), covering both primary and secondary markets, recorded net outflows.
Gross official reserves, including the swap facility with the People’s Bank of China (PBOC), stood at around USD 6.2 billion by end-October 2025.
The year-to-date depreciation of the Sri Lanka rupee against the US dollar was 5.0% at end-November 2025.
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