Maldives’ national reserves declined significantly during September.
This was revealed by the Maldives Monetary Authority (MMA) through its latest statistics.
The central bank’s statistics indicate that the national reserve declined by USD 72 million in comparison to the previous month.
At the end of August, the country's national reserve sat at USD 443.88 million.
This was an increase of USD 48.45 million compared to July.
However, by September 24, the reserve had fallen to USD 371.22 million.
Further, MMA revealed that the usable reserve had surged by USD 61 million in August.
However, the usable reserve has since dropped steeply by USD 49 million.
It is believed that a significant chunk of the reserve was spent due to a 25 million-dollar coupon payment on the USD 500 million Sukuk bond maturing in 2026.
The payment was made on Monday.
Maldives is required to repay a foreign debt of USD 600 million in 2025 and over a billion U.S. dollars in 2026.
Global credit rating agencies have expressed concerns regarding these financial obligations.
In early September, Moody’s downgraded the Maldives’ credit rating from CAA1 to CAA2.
This came at the heels of one of the world’s largest credit rating agencies, Fitch Ratings downgrading Maldives’ credit rating to ‘CC’ from ‘CCC+’.
Stressing on the increased risk of default, the U.S credit rating agency noted that some of the main reasons behind its decision is the plummeting gross foreign exchange reserves as well as spiraling external debt service.
Moody's cited the reason for the downgrade owing to their assessment indicating an increased risk of default for the Maldives.
