The Central Bank of Sri Lanka (CBSL) has implemented several schemes of debt moratoria and concessions to assist the borrowers affected by the COVID-19 outbreak and subsequent macroeconomic developments, through Financial Institutions (FIs) supervised by CBSL. These schemes included extended repayment periods, concessionary rates of interest, working capital loans, debt moratoria and restructuring/rescheduling of credit facilities for affected borrowers.
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Concessionary Measures to Micro, Small and Medium Enterprises (MSMEs) and Individuals affected by the Present Macroeconomic Conditions
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Former Governor of the Central Bank, Mr. H.B. Dissanayake, Passes Away
It is with deep sorrow that we announce the demise of former Governor of the Central Bank of Sri Lanka (CBSL), Mr. H.B. Dissanayake.He passed away at the age of 85 on the 05th of March 2023.
Mr. Dissanayake functioned as the 09th Governor of the CBSL from 1 July 1992 to 15 November 1995. Prior to assuming duties as Governor, he served as Director General of Customs and after retiring from the CBSL, he served as Alternate Executive Director at the International Monetary Fund (IMF) from 1996 -1998.
Mr. H.B. Dissanayake’s remains lie at his home (No. 2/84, Mihiri Uyana, Old Kottawa Road, Mirihana, Nugegoda) until 01.00 p.m. on 07th of March (today) and the cremation will be at the Public Cemetery, Mirihana.
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The Central Bank of Sri Lanka raises the Policy Interest Rates
The Monetary Board of the Central Bank of Sri Lanka (CBSL), at its meeting held on 03 March 2023, decided to raise the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Central Bank by 100 basis points to 15.50 per cent and 16.50 per cent, respectively, effective from the close of business on 03 March 2023.
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CCPI based headline inflation eased in February 2023
Headline inflation, as measured by the year-on-year (Y-o-Y) change in the Colombo Consumer Price Index (CCPI, 2021=100) decreased to 50.6% in February 2023 from 51.7% in January 2023. The decline in the headline inflation is broadly in line with the disinflation path envisaged by the Central Bank of Sri Lanka (CBSL) in January 2023.
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External Sector Performance - January 2023
The deficit in the merchandise trade account narrowed in January 2023, compared to a year ago.
Export earnings declined while import expenditure remained subdued in January 2023, compared to year earlier.
Workers’ remittances and earnings from tourism continued to increase in January 2023.
Gross official reserves strengthened at end January 2023, while the exchange rate remained stable during January 2023.
The Colombo Stock Exchange (CSE) recorded a marginal net inflow, while foreign investments in the government securities market recorded a marginal net outflow during January 2023.
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Land Valuation Indicator – Second Half of 2022
Land Valuation Indicator (LVI) for Colombo District increased by 14.8 per cent on a year-on-year basis to 205.2 during the second half of 2022. All sub-indicators of LVI, namely Residential LVI, Commercial LVI and Industrial LVI contributed to the overall increase.
Commercial LVI recorded the highest annual increase of 15.7 per cent, followed by Residential LVI (15.2) and Industrial LVI (13.6). However, a downward trend was observed in the annual increase of LVI in second half of 2022, driven by the decline in the annual increase of Industrial LVI. Meanwhile, the annual growth of Residential and Commercial LVIs increased slightly during the second half of 2022.
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SL Purchasing Managers’ Index (PMI) – January 2023
In January 2023, Purchasing Managers Indices indicated that Services activities remained slightly expanded while Manufacturing activities continued to deteriorate.
Manufacturing PMI signals a continued setback in manufacturing activities on a month-on-month basis in January 2023. Accordingly, Manufacturing PMI recorded an index value of 40.8 in January 2023, with a decline of 4.0 index points from the previous month driven by the decreases in all the sub-indices, except Suppliers’ Delivery Time.
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Regulations on Financial Consumer Protection
Having recognized the need to institutionalize financial consumer protection in the delivery of services by financial institutions regulated by the Central Bank of Sri Lanka, the Financial Consumer Relations Department of CBSL has developed a comprehensive set of new regulations aiming at introducing an integrated financial consumer protection framework for entities regulated by CBSL. These regulations are expected to define specific regulatory powers for the supervisors to facilitate market conduct supervision while providing clarity to both the service providers and recipients on the areas to be considered in delivering/ obtaining financial services aiming at minimizing the need for financial consumers to make subsequent complaints.
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The Central Bank of Sri Lanka issues a Coin to mark the 75th Independence Celebration of Sri Lanka
The Central Bank of Sri Lanka (CBSL) issued an uncirculated commemorative coin in the denomination of Rupees 1000 to mark the 75th Independence Day Celebration in the country, which falls on 04.02.2023. This is the 71st commemorative coin that was issued by the Central Bank. The detailed description and specifications of the coin are given below.
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External Sector Performance - December 2022
Earnings from exports in 2022 surpassed US dollars 13 billion per year for the first time, recording an increase of 4.9 per cent from the previous highest recorded in 2021. This improvement was a result of increased earnings from industrial exports, including garments, gems, diamonds and jewellery, machinery and mechanical appliances and petroleum products. Meanwhile, total import expenditure in 2022 amounted to US dollars 18,291 million, recording a decline of 11.4 per cent, year-on-year, resulted from measures to restrict non-urgent imports and liquidity constraints prevailed in the market for the most part of 2022. As a result, the deficit in the trade account in 2022 narrowed to the lowest level since 2010 to US dollars 5,185 million, from US dollars 8,139 million recorded in 2021. The major contributory factors for the decline in the cumulative trade deficit in 2022 are shown in Figure 1.