Abstract:
Tea is an important agricultural commodity grown in Sri Lanka. It generates a significant amount of foreign exchange. This study was conducted to investigate the relationship between exchange rate volatility and the volume of tea exports in Sri Lanka during 2011-2021. Secondary data related to the volume of tea export, exchange rate, tea prices, inflation rate, and volume of tea production in Sri Lanka from 2011 to 2021 on a monthly basis were used.Regression analysis was used for data analyses. According to the result, there was a negative relationship between exchange rate volatility and the volume
of tea export. The inflation rate was a significant factor that affected tea export volume. According to the findings, updating relevant monetary and tea production-related policies by the government are important to increase tea exports from Sri Lanka in the future.
