Foreign investors bought Sri Lankan rupee bonds for a third straight week in the week ended 16 October, despite mild depreciation pressure on the currency, EconomyNext reported on Sunday, citing Central Bank data.

Offshore investors bought a net Rs. 364 million (US$1.1 million) during the week — a small figure, and smaller than each of the two preceding weeks. Analysts told EconomyNext that buying had eased because of the downward pressure on the rupee.

The three-week run has brought in Rs. 5.5 billion, following a Rs. 16.5 billion outflow across the two weeks before it. Foreign holdings of government securities now stand at Rs. 202.4 billion.

The streak reconciles exactly against the record

EconomyNext says there has now been net foreign buying in 16 of the last 18 weeks. That claim can be checked against this desk’s own coverage, and it holds precisely.

At the end of September this desk reported that foreign investors had sold rupee bonds for a second week, ending a 13-week buying run. Thirteen weeks of buying, two of selling, and the three weeks of buying since make 18 weeks, 16 of them net purchases — exactly as stated.

The holdings figure reconciles the same way. That September article recorded foreign holdings at Rs. 196.9 billion at the end of the two-week sell-off. Adding the Rs. 5.5 billion bought since gives Rs. 202.4 billion, the figure reported on Sunday. The year-to-date inflow has moved from Rs. 55.7 billion then to Rs. 61.1 billion now, consistent with the same Rs. 5.4–5.5 billion.

So the three-week run has recovered roughly a third of the Rs. 16.5 billion that left in September, and holdings are back above where they stood before that episode.

The currency is the pressure point

The rupee has fallen 6.4 percent through 16 October this year. It had been steady for more than three years before a sharp depreciation in May, which the Central Bank attributed to higher oil and vehicle import bills amid the continuing Middle East conflict.

That same month the Central Bank raised its key policy rate by 100 basis points to contain inflationary pressure from stronger demand — the first tightening after keeping rates unchanged since May 2025, and following 825 basis points of cuts over the 24 months from June 2023.

Inflation has picked up over the past six months on the back of a near 50 percent rise in fuel prices. The government raised fuel prices again in the last week of September, after cuts in June and August.

The year’s inflow of Rs. 61.1 billion remains below last year’s full-year total of Rs. 71.5 billion, with about ten weeks of the year left.

What the data does not show

Weekly Central Bank securities data gives a net figure only. It does not identify who is buying or selling, distinguish real-money investors from short-term positioning, or break holdings down by maturity — so a Rs. 364 million net week could equally be a quiet week or two large opposing trades.

Nothing in the filing explains why the September outflow happened or why buying resumed, beyond the analysts’ reference to currency pressure.

Not reported

No other verified newsroom had filed on the week’s securities data when this article was written. EconomyNext publishes this series weekly and is routinely first; corroboration from Daily FT, Daily Mirror Business or Lanka Business Online, where it comes at all, has typically arrived several days later.

Sources: EconomyNext. Prior-week comparisons from this desk’s own archive.