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Maldives’ official reserves have declined by more than half since March, following major external debt repayments and continued pressure on the country’s foreign exchange position.
Mariyam Adheela
Maldives’ official foreign currency reserves fell to USD 638.03 million at the end of July, continuing a steady decline recorded since March, according to the latest figures from the Maldives Monetary Authority (MMA).
Official reserves stood at USD 1.33 billion in March before dropping significantly in April and continuing to fall over the following three months.
MMA data shows reserves declined to USD 717.90 million in April, USD 704.77 million in May and USD 686.83 million in June, before reaching USD 638.03 million in July.
The sharpest decline came in April, when the government settled USD 524.68 million in securities issued by the previous administration.
The repayment was financed through a combination of the Sovereign Development Fund (SDF) and the government’s official reserves.
The government also repaid a USD 400 million currency swap facility provided by India during the same month, further contributing to the reduction in foreign currency holdings.
The continued fall in reserves comes as the Maldives faces growing pressure in the foreign exchange market, with banks experiencing difficulties in meeting demand for US dollars at the official exchange rate.
The US dollar has also continued to trade above MVR 20 on the black market, reflecting the ongoing shortage of foreign currency.
