• Issuance of Treasury Bills to the Central Bank

    The Central Bank of Sri Lanka (CBSL) subscribed to Treasury bills (T-bills) amounting to Rs. 90 billion in January 2019 at the request of the Treasury to assist financing needs of the government due to the delay in receiving expected foreign currency financing arrangements as envisaged in the Treasury’s cash flow for the month of January 2019. The Monetary Board has acceded to the Treasury’s request in the national interest and under exceptional circumstances.

    Having reviewed the macroeconomic consequences of subscribing to T-bills by the CBSL, the Government has agreed to reverse part of the transaction in February and the balance during the first quarter of 2019 once the Government's borrowing programme is brought back on track with realisation of expected financial arrangements.

  • Sri Lanka Purchasing Managers’ Index - December 2018

    Manufacturing activities increased at a slower rate in December compared to November mainly driven by the slowdown in employment and production, especially in manufacturing of textiles, wearing apparels, leather and related activities. A significant decline in employment was experienced as some employees moved to seasonal jobs for better salaries. This partly impacted on decrease in production. However, new orders increased mainly driven by the manufacturing of food and beverages activities with the continued festival season demand. 

    Meanwhile, stock of purchases indicates an increase due to intended accumulation of stocks to fulfil the future requirements anticipating supply disruptions due to upcoming  Chinese new year festival. In line with this, suppliers’ delivery time also lengthened.  

  • Statement by IMF Managing Director Christine Lagarde on Meeting with Sri Lanka’s Finance Minister Mangala Samaraweera and Governor Indrajit Coomaraswamy

    Christine Lagarde, Managing Director of the International Monetary Fund (IMF), met today with Sri Lanka’s Finance Minister Mangala Samaraweera and Governor Indrajit Coomaraswamy. 

    Following the meeting, Ms. Lagarde made the following statement:

    “I was pleased to meet with Minister Samaraweera and Governor Coomaraswamy this afternoon. We discussed the challenging economic environment and the policy priorities for the country. The authorities stressed Sri Lanka’s continued commitment to their economic reform agenda under the IMF-supported program. 

    “We agreed that a strong policy mix, with effective implementation of that agenda, is key to strengthening confidence, while putting Sri Lanka on a sustainable, high-quality growth path that would benefit its people. 

    “The IMF remains ready to support the Sri Lankan authorities in these endeavors and an IMF team is scheduled to visit Colombo in mid-February to resume program discussions.” 

  • RBI Agrees to USD 400 mn SWAP - Boost to Reserves

    The Reserve Bank of India (RBI) has agreed to provide USD 400 mn to the Central Bank of Sri Lanka (CBSL) under its SAARC SWAP facility.

    CBSL has also requested a further bilateral SWAP arrangement of USD 1 billion between the RBI and CBSL which is under consideration.

    The RBI’s very rapid and timely assistance will serve to boost investor confidence by supporting Sri Lanka to maintain an adequate level of external reserves while accommodating outflows related to imports, debt servicing and, if necessary, support for the currency to avoid disorderly adjustment.

    The CBSL acknowledges the very active role played by the Government of India, the Sri Lankan High Commission, in Delhi, and the Indian High Commission, in Colombo, in facilitating these arrangements.

  • External Sector Performance - November 2015

    The trade deficit contracted in November 2015 compared to the corresponding month of 2014 due to the decline in import expenditure at a higher rate than the reduction in export earnings. Tourist earnings continued to increase, but the growth in workers’ remittances moderated. Inflows to the financial account strengthened with the proceeds from the latest International Sovereign Bond of US dollars 1,500 million.

  • Financial Sector Regulators Sign a Memorandum of Understanding for Consolidated Risk-based Supervision

    The Central Bank of Sri Lanka (CBSL) entered into a Memorandum of Understanding (MoU) with the Securities and Exchange Commission of Sri Lanka (SEC) and the Insurance Regulatory Commission of Sri Lanka (IRCSL) on 31 December 2018 at CBSL, to conduct effective consolidated risk-based supervision and for CBSL to be the lead supervisor in this regard.

  • Extension of the Suspension of Business of Perpetual Treasuries Limited

    The Monetary Board of the Central Bank of Sri Lanka, acting in terms of the Regulations made under the Registered Stock and Securities Ordinance and the Local Treasury Bills Ordinance, has decided to extend the suspension of Perpetual Treasuries Limited (PTL) from carrying on the business and activities of a Primary Dealer for a period of six months with effect from 4.30 p.m. on 05th January 2019, in order to continue the investigations being conducted by the Central Bank of Sri Lanka.

  • Monetary Policy Review - February 2016

    Broad money (M2b) continued to grow at a high pace, recording a growth of 17.8 per cent (year-on-year) in December 2015 compared to 13.4 per cent in December 2014. The year-on-year growth of credit granted to the private sector by commercial banks accelerated during the year, with a growth of 25.1 per cent in December 2015 in comparison to 8.8 per cent in December 2014. In absolute terms, the expansion in private sector credit during 2015 amounted to Rs. 691.4 billion compared to Rs. 223.9 billion in 2014.

  • Inflation in January 2016

    Inflation, as measured by the change in the National Consumer Price Index (NCPI) (2013=100), which is compiled by the Department of Census and Statistics, decreased to -0.7 per cent in January 2016 from 4.2 per cent in December 2015, on year-on-year basis mainly due to the higher base of the corresponding period in 2015. Annual average NCPI inflation decreased to 2.9 per cent in January 2016 from 3.8 per cent recorded in December 2015.

  • Road Map 2019 - Monetary and Financial Sector Policies for 2019 and Beyond

    The Sri Lankan economy faced heightened challenges in 2018, emanating mainly from the global economic, financial and geo-political developments that adversely affected the external sector. There were also several domestic challenges. Political uncertainties, especially during the last quarter of the year, amplified challenges to overall macroeconomic stability. Sub-par economic growth continued in 2018 following subdued growth in 2017. Favourable weather conditions supported a rebound in the agriculture sector while the expansion in services activities has been broad-based.