Fitch cuts Sri Lanka’s rating outlook to negative

[Reuters]

Fitch Ratings changed the outlook on Sri Lanka to negative from stable on Friday, expressing worries about its external financial position reflected in the sharp fall in its foreign exchange reserves. “Without a sharp contraction in domestic demand to curtail imports, or a significant depreciation of the exchange rate to otherwise correct the trade imbalance, Sri Lanka may not have access to sufficient international funding to cover the current account shortfall and its international debt repayments, resulting in ongoing pressures on official reserves,” the agency said in a statement.

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