Sri Lanka defended its foreign exchange rate policy after the International Monetary Fund (IMF) asked it to limit its interventions and allow more currency flexibility, Reuters reports. The IMF said the country’s non-borrowed reserves have declined, reflecting foreign exchange sales by the central bank.

The central bank responded by saying that the policy has been consistent, where intervention was required in both sides of the market to maintain stability while allowing adequate flexibility. The dollar sales were due to large oil bills, the bank said.

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