Rupee surpasses Russian rouble as world’s worst-performing currency

The Sri Lankan rupee has become the world’s worst-performing currency, surpassing the Russian rouble, according to the UK-based Financial Times.

“The rupee was hovering near 300 per US dollar on Wednesday, down 32 percent year to date and lagging even Russia’s rouble, after Rajapaksa ended emergency rule just days after it was imposed,” the FT report said.

The news report also noted that the hallowing out of the Rajapaksa regime has stoked concern over the country’s ability to secure help form the International Monetary Fund (IMF).

Pervious Finance Minister Basil Rajapaksa was supposed to travel to Washington D.C. in mid-April to discuss a rescue package with the IMF, prior to his resignation over the weekend.

Former Justice Minister Ali Sabry, who succeeded Basil Rajapaksa as the Finance Minister, resigned from the post even before 24 hours since he was appointed. Along with him, Finance Ministry Secretary S.R. Attygalle also resigned.

At the moment, Sri Lanka doesn’t have a Finance Minister and a Finance Ministry Secretary. 

“Things don’t look good. So much depends on whether they can get any IMF funding,” the FT news report quoted Steve Cochrane, chief Asia-Pacific economist at Moody’s, as saying. 

“A stable government matters,” he had added.

“With the government in disarray, the prospects of securing an IMF package look bleak,” said Alex Holmes, Asia economist at Capital Economics, who was also quoted in the FT news report. 

“That again elevates the chances that the government will eventually have to resort to a sovereign default,” he had added.

Sri Lanka’s foreign reserves are estimated to be adequate for only one month of imports and the country has a US $ 1 billion sovereign bond repayment coming up in July.