To enhance economic stability and support sustainable growth, the Maldives Monetary Authority (MMA) has initiated a set of monetary policy measures to manage surplus liquidity and ensure continued confidence in the national currency. These efforts come amid growing activity in the domestic financial sector and an evolving external trade environment.
As of June 2025, the total money supply in the country reached MVR 64.5 billion, reflecting a robust 10.7 percent increase compared to the same period last year. This growth, driven by increased domestic investments and public sector reforms, marks a continued expansion of the local capital market and financial services industry.
The central bank has reported that over MVR 7 billion in excess liquidity has accumulated within the banking system. This increase is attributed to structural shifts in public finance management, including the reclassification of short-term liabilities into long-term bonds under previous fiscal strategies, as well as improved banking activity. Since April 2020, liquidity in the market has surged by an impressive 178 percent, while bank rupee deposits have grown by 18 percent year-on-year.
Investment in government securities by commercial banks has also climbed significantly, up by 20.9 percent, illustrating strong investor confidence in public sector instruments. Lending to the private sector has expanded by 6 percent, with a notable increase in rupee-denominated loans, a sign of deepening engagement between the financial system and local enterprises.
To maintain a healthy balance between liquidity and monetary stability, the MMA has resumed Open Market Operations (OMO), a core monetary instrument to absorb excess funds from the banking system. On 23 July 2025, a successful reverse repurchase operation was conducted, withdrawing MVR 2.1 billion. The central bank has affirmed that it will continue to use appropriate tools to safeguard the stability of the rufiyaa and strengthen macroeconomic resilience.
On the external front, the Maldives continues to demonstrate steady progress. Gross foreign reserves stood at USD 832 million as of June 2025, reflecting improvements in both fiscal management and foreign exchange earnings. Usable reserves reached USD 202 million, with continued momentum supported by a 30 percent increase in tourism-related revenue inflows during the first seven months of the year compared to 2024. This includes growth in income from taxes, airport service charges, and other tourism sector contributions.
The MMA also highlighted that since the dip in reserves in September 2024—when gross reserves touched USD 371.2 million, Maldives has made notable strides in rebuilding its external buffers. Strengthened tax administration, more effective enforcement of foreign exchange regulations, and expanded currency swap agreements have contributed to the recovery of reserves.
In addition, the central bank has increased the volume of USD sales through the formal banking sector, facilitating USD 217 million in foreign currency transactions so far this year. These transactions cover essential services including overseas medical treatment, education, and travel, underscoring the authority’s commitment to supporting the financial needs of Maldivian citizens and residents.
The fiscal and monetary coordination efforts also aim to manage rising foreign debt levels and meet import requirements, particularly in key sectors such as energy and food security. Fuel imports alone have accounted for an average of 49 percent of total imports from 2022 to 2024, reinforcing the importance of prudent reserve management and strategic sourcing.
Through these proactive and carefully calibrated measures, the Maldives continues to build a resilient financial environment that supports domestic growth while ensuring long-term monetary stability. The MMA’s approach is designed not only to navigate current economic dynamics but also to lay the foundation for future prosperity, reinforcing investor confidence and promoting a well-regulated, thriving financial system.
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