COLOMBO, 19 May 2021, (TON): The central Bank reported that Sri Lanka’s external sector showed a mixed performance in March 2021 with a widened trade deficit.

The deficit in the trade account widened in March 2021, for the first time since April 2020.  Exports and imports in March 2021 were significantly higher, compared to March 2020 as well as February 2021.

The trade deficit increased to US$ 832 million in March 2021 compared to the deficit of US$ 549 million recorded in March 2020.

Meanwhile, the cumulative deficit in the trade account during January - March 2021 widened to US$ 2.059 billion from US$ 1.853 billion recorded over the same period in 2020.

Earnings from merchandise exports in March 2021 increased by 66.7 percent to US$ 1.094 billion, compared to March 2020. Earnings from exports improved considerably in March 2021 compared to February 2021 also raising export earnings towards pre-pandemic export levels.

The exchange rate came under severe pressure during March 2021, partly reflecting the seasonal demand for imports. Accordingly, the Sri Lankan rupee depreciated by 2.5 percent against the US dollar during the month of March. Overall, the rupee recorded a depreciation of 6.7 percent against the US dollar in 2021 up to 18 May 2021.