By -

 What became of the Dollar?

Today, the economy of our country is an important topic. When talking about the economy these days, the first thing that comes to mind is the ‘dollar.’ Everyone knows about the situation with the dollar in Sri Lanka. The economy and the dollar are two things that are inextricably linked. The value of the dollar is a crucial element in this context of import, export, income, expenditure, and debt.

The rise and fall of the dollar value is a normal economic phenomenon. But the sudden decrease in the dollar, which was continuously rising, is a significant situation. This situation is widely discussed among analysts.

What could actually be the reason for this? Analysts present various types of reasons related to this. Let's talk about some of them.

They say that the new income tax policy imposed by the government has led to a change in the dollar. Due to the imposition of income tax, the amount of money to be spent on household goods and services decreases to some extent. The reduction of this in individual houses as a whole economy, the expenditure on goods and services of the whole economy is reduced. Then the demand for dollars decreases due to the decrease in import costs. This can be taken as one reason.

Another reason is interest rates. The recent increase in interest rates by the government is the reason for the decrease in investment. Therefore, the demand for goods and services also decreases due to investment. Hence the demand for dollars also decreases. Accordingly, the value of the Sri Lankan rupee is strengthened.

Also, a positive foreign exchange can be seen in the interbank market. More than forty billion dollars of foreign currency has been exchanged in the interbank market. Before it used to be around eight to ten billion dollars. Therefore, this is a positive situation to strengthen the Sri Lanka Rupee.

Foreign direct receipts also increased to seven billion dollars. For that, increasing the supply of dollars is a positive situation for our economy.

If we talk about the stock market, more than three billion dollars of direct investments have been received. This means that the supply of dollars to the government and private companies has increased.

All these reasons show that the rupee has strengthened to some extent recently. It is impossible to say what will happen in the future. We hope that the economic situation will improve in the future.


Harshanie Erandika Liyanage

Faculty of Management and Finance


Comments

Post a Comment

Popular posts from this blog

Sasiri Hetak - phase 01

By -
Image
                  'Sasiri Hetak'- Phase 01 Education is one of the most critical pillars of a nation's development. The future of a country heavily relies on the quality of education it provides, and schools are at the heart of this system. In Sri Lanka, there are approximately 10,155 schools. Unfortunately, many of these schools lack even the most basic facilities, which hinders the ability to provide quality education.   We have recognized this problem and organized to implement 'Sasiri Hetak’ school renovation project as continues project in Leo club of University of Colombo. We aim to renovate six schools and provide essential facilities. The first phase of the "Sasiri Hetak" project at Gungamuwa Junior College, Bandaragama, was initiated with the goal of converting the main hall into classrooms, as requested by the principal. To raise funds, the team organized popcorn stalls in management faculty and also, we sold popcorn at Galle face, with members and
Read more

Diyani 8.0 - Phase 01

By -
Image
          Diyani 8.0 - Her Well (First Phase ) ~Access to basic sanitation should be a basic right, not a privilege~ Sanitation and hygiene practices are crucial for maintaining health and well-being, yet many people, particularly women, face significant barriers in accessing proper education and resources. Menstruation remains a taboo in many cultures, viewed as shameful or impure due to cultural and religious norms. This stigma prevents open discussions and limits access to information and resources. As the world observes International Menstrual Hygiene Day 2024 with the theme "Period Friendly World," the question remains: Are we ready to talk openly about periods? To address this, Leo Club of University of Colombo conducted "Her Well" on 11th October 2024, marking the first phase of Diyani 8.0. Held at Ihala Madampalla Ranasinghe M.V., the project aimed to raise awareness about sanitation and menstrual hygiene among students, targeting both boys and girls to br
Read more

ECO CLEAN - PHASE 01🌍

By -
Image
  Eco Clean Initiative by University of Colombo Leo Club Successfully Completes First Phase.On September 27, 2024, University of Colombo's Leo Club successfully concluded the first phase of its "Eco Clean" initiative, titled "Waste Wise." This project aims to raise awareness about waste management, with a special focus on the importance of plastic recycling among the younger generation. The primary objective of this phase was to educate young people, particularly students, about sustainable practices related to household waste management and to instill a mindset that promotes environmental responsibility. In partnership with Ingiriya Gamini Vidyalaya's vocational education students, this project sought to target a group with a unique potential to influence future industries. The rationale behind involving these vocational students was to prepare them for roles in industries where sustainable practices, like proper waste management and environmental awareness
Read more