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Sri Lanka says latest bailout funds can be used for fiscal support - Bloomberg News

FILE PHOTO: Nandalal Weerasinghe, Governor of the Central Bank of Sri Lanka, speaks during a news conference in Colombo, Sri Lanka, April 8, 2022. REUTERS/Dinuka Liyanawatte

The International Monetary Fund (IMF) is allowing Sri Lanka to utilise funds from its latest bailout for fiscal support, unlike previous loans that could only be used to ease balance of payments crises, central bank governor Nandalal Weerasinghe said in an interview with Bloomberg.

Upon receiving the funds from the IMF, the monetary authority can buy foreign exchange and provide the government an equivalent amount of rupees to spend, Weerasinghe told Bloomberg on Tuesday.

"In line with IMF fiscal deficit targets, instead of raising money from domestic markets, they can use that money to finance the budget," the report quoted Weerasinghe as saying.

(Reporting by Yana Gaur in Bengaluru; Editing by Edmund Klamann)

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