Sri Lanka’s currency dropped to a record low on Friday, Reuters reported.
On Thursday, the Central Bank governor Arjuna Mahendran said warned that the government should let market forces determine its rupee exchange rate and that trying to buck the global trend of a rising dollar is "suicidal".
Finance Minister Ravi Karunanayake said on Thursday that Sri Lanka is planning to borrow $1bn, in five-year syndicated loans from international banks and it could borrow up to $2bn.
"We feel, before the LIBOR goes up, we can do certain things and get the benefits," Karunanayake told a Foreign Correspondents Association (FCA) forum in Colombo.
"We find unsolicited proposals coming in from banks like BNP, Credit Suisse, and Barclays roughly at 325-375 (basis points) and we believe that we could collect about $1 billion in the next couple of days .... It would even go up to $2 billion."
Mr Karunanayake also said Sri Lanka is negotiating foreign exchange swaps with two more countries, after a swap agreement with India for $1,500mn was completed in March, with around $400mn already drawn.
Last month the government raised $650mn from a 10-year sovereign bond and sold $338mn of one year floating rate bonds to the local market.
Fall in Sri Lanka forex reserves (07 June 2015)
Reserve Bank of India signs currency swap agreement with Sri Lanka (31 March 2015)
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