The Maldives’ official foreign currency reserves fell to USD 638.03 million by the end of July, continuing a downward trend seen in recent months.
According to data from the Maldives Monetary Authority (MMA), reserves stood at USD 1.33 billion in March but declined sharply in April to USD 717.90 million. They then fell to USD 704.77 million in May, USD 686.83 million in June and USD 638.03 million in July.
The major decline in April came after the government settled USD 524.68 million in securities issued by the previous administration. The payment was financed through the Sovereign Development Fund and official reserves.
The government also repaid a USD 400 million currency swap facility provided by India during the same month.
The continued decline in reserves comes amid growing pressure in the local foreign exchange market. Banks have faced difficulties meeting demand for US dollars at official rates, while dollars have continued to trade above MVR 20 in the black market.
The falling reserve level has increased concerns over the country’s foreign currency position and its ability to meet future external payment obligations.
