Sri Lanka’s Rupee sheds a third of its value against the dollar as deepening crisis raises threat of default

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Sri Lanka’s rupee has plunged to a record low to become the world’s worst-performing currency, as President Gotabaya Rajapaksa struggles to contain a worsening economic and political crisis. The Sri Lankan rupee was hovering near SLRs300 per US dollar on Wednesday, down 32 per cent year to date and lagging even Russia’s rouble, after Rajapaksa ended emergency rule just days after it was imposed. Sri Lanka is facing a foreign exchange crisis as its government grapples with looming debt payments, widespread protests and an economic emergency. The backpedal on the emergency decree from Rajapaksa’s government came after his new finance minister, Ali Sabry, quit less than 24 hours into the job. Sabry’s resignation was the latest in a rush of departures. The country’s entire cabinet quit over the weekend following nationwide protests over severe food and power shortages as well as runaway inflation. Central bank governor Ajith Nivard Cabraal, who was scheduled to oversee a policy meeting on Thursday, also resigned on Monday.

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