Rupee Soars as Monsoon Intensifies; US-Iran Deal Looms Amidst Domestic Challenges

The Sri Lankan Rupee has significantly appreciated against the US Dollar, with selling rates dropping to around Rs. 340 by May 22nd and further to Rs. 330 by May 25th, marking a notable reversal from previous depreciation trends

. The Rupee surged by 2.7% against the US Dollar on May 24th, its largest single-day gain since March 2023, making it Asia's best-performing currency, driven by expected IMF and ADB inflows

. The 50% surcharge on imported vehicles may be extended beyond three months due to economic pressures, with the CBSL indicating a temporary price increase

. Effective May 25th, the CBSL also reduced Loan-to-Value (LTV) ratios for vehicle loans: commercial vehicles to 60% and private vehicles to 40%, alongside a 70% LTV cap on gold collateral, to promote prudent lending

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. Sri Lanka launched a free 30-day tourist ETA for 40 countries, effective May 25, 2026, though all eligible foreign nationals must still obtain an ETA prior to arrival

. Sri Lanka's export revenue for the first four months of 2026 reached US$ 5.784.30 billion, a 4.3% increase year-on-year

. The vehicle market is bracing for significant price hikes due to new tax revisions and Rupee depreciation, with import costs surging by up to 110%

. The Inland Revenue Department has filed a lawsuit against the Colombo Municipal Council to recover Rs. 1034 million in unpaid VAT

. The Sri Lanka Vehicle Importers Association has called for a probe into LCs opened just before the 50% import duty surcharge and opposes the CBSL's credit caps

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US President Donald Trump has instructed negotiators "not to rush" into an agreement with Iran, despite earlier claims that a deal was "largely negotiated," which reportedly includes a 60-day ceasefire extension and the reopening of the Strait of Hormuz

. Former Minister Wimal Weerawansa, arrested on May 25th over a monument incident, has been granted Rs. 500,000 surety bail by the Kaduwela Magistrate's Court, with investigations ongoing

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. India has donated 134 single cab vehicles valued at approximately Rs. 300 million to the Sri Lanka Police, reinforcing bilateral ties

. US Secretary of State Marco Rubio met with Indian Prime Minister Narendra Modi in New Delhi to discuss trade, economic matters, and regional security during his four-day official visit

. JVP General Secretary Tilvin Silva stated that Provincial Council elections are unlikely this year and affirmed that only a National People's Power (NPP) government will lead the country

. Sri Lanka will implement digital motor insurance cards from May 1, 2026, replacing traditional documents as part of a broader digitization plan

. Iran claimed a missile strike on a US warship near the Strait of Hormuz, which the US denied, while reporting its own operations against an Iranian-flagged oil tanker in the Gulf of Oman

. Shashie Weerawansa's passport case, concerning allegations of obtaining a diplomatic passport via forged documents, has been adjourned until July 24 for an evidence hearing

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The National Building Research Organisation (NBRO) has extended landslide warnings, including Level 1 and Level 2 alerts, for 24 Divisional Secretariat divisions across six districts until 4 p.m. on Tuesday, May 26th

. The Southwest Monsoon has arrived, bringing heavy rainfall of about or exceeding 100 mm and fairly strong winds of (30-40) kmph to southwestern parts of the island, expected to continue until May 28th

. The Meteorological Department issued a special red notice for heavy rainfall exceeding 200mm and a flood risk for several areas, along with an advisory for strong lightning in Uva Province, Ampara, and Batticaloa districts

. The Southwest monsoon continues to establish, with an increase in rainfall expected in the southwestern parts of the island, forecasting intermittent rain or thunderstorms and heavy showers exceeding 75mm for several provinces and districts

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Eight inmates admitted to Hambantota Hospital for an unknown fever have recovered and returned to Angunakolapelassa Prison, though operations remain halted, and inmate transfers have stopped to control illness spread

. In Congo, a health center housing suspected Ebola patients was attacked on May 25, 2026, leading to the escape of over 200 individuals, with 18 confirmed Ebola cases among them

. The Epidemiology Unit has issued special guidelines to control the rapid spread of Enteroviral Meningitis, particularly among schoolchildren, with key symptoms including fever, headache, and vomiting

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The second accused in the Vidya murder case, Poobalasingham Jayakumar, died by suicide in Jaffna Prison on May 25, 2026, following the Supreme Court's confirmation of death sentences for four individuals in the case

. Sri Lanka Customs apprehended three Chinese nationals at BIA attempting to smuggle foreign-made cigarettes valued at Rs. 6,060,000

. The suspect in the Dikoya double murder, Sellaiya Manoj, has been remanded until June 3rd, with 18 sovereigns of gold jewellery recovered from the elderly couple's murder

. The Colombo Crime Division (CCD) recovered a T-56 assault rifle buried in the Somawathiya National Reserve, suspected to belong to an individual recently shot dead by police

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The Southwest Monsoon is gradually establishing across the island, with the Meteorological Department forecasting heavy rain of up to 100mm in many parts of the island within the next 36 hours, particularly in Western, Sabaragamuwa, and North-Western provinces, and Galle, Matara, Kandy, and Nuwara Eliya districts

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The Department of Examinations announced that the results for the 2025 G.C.E. Ordinary Level Examination are expected to be released by mid-June, clarifying that no exact date has been finalized despite social media rumors

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A bus transporting apparel factory workers overturned into a paddy field in Kahathuduwa, injuring 19 people, with none of the injuries reported as life-threatening

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