Sri Lankan Monetary Policy Stance Held Steady

February 16, 2010

The Central Bank of Sri Lanka retained its repo and reverse repo rates of 7.5% and 9.75% for a third consecutive month.  Upwardly creeping CPI inflation is attributed to higher commodity prices and base effects, and the primary object of central bank policy continues to be the promotion of domestic economic recovery.  The repo and reverse repo rates were cut by 50 basis points each last September and 75 bps and 50 bps, respectively, in November.  earlier in 2009, those rates had been sliced by 175 bps and 125 bps.  The repo rate is now at a five-year low compared to 10.5% at the start of last year.

Copyright Larry Greenberg 2010.  All rights reserved.  No secondary distribution without express permission.



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