The Manufacturing Sector PMI Increased to 58.2 index points in August 2018 from 57.2 index points observed in the previous month. The expansion observed in manufacturing activities in August was mainly driven by expansion in production led by the increase in new orders, especially in manufacturing of textiles, wearing apparel, leather and other related products. Further, employment also increased at a higher rate with the recruitment of employees especially for food and beverages sector led by the positive outlook for improving activities within this sector. However, stock of purchases show some slowdown, especially in manufacturing of other non-metallic mineral products. Nevertheless, stock of purchases in the manufacturing of textiles, wearing apparel, leather and other related products increased.
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Sri Lanka Purchasing Managers’ Index - August 2018
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Statement of the Monetary Board on Treasury Bond Auctions
This refers to the recent articles and discussions relating to the Treasury bond auctions that took place during the latter part of March 2016, where allegations of lack of transparency were made with regard to the process that was followed. Attention of the public is drawn to the fact that the process followed was similar to what has been in practice since February 2015 when a complete market based mechanism was introduced in auctioning of Treasury bills and bonds.
The Monetary Board noted the large resource needs of the Government. Further, in the context of Monetary Policy actions, mainly the upward adjustment of the Statutory Reserve Requirement (SRR) at the beginning of the year and the subsequent upward adjustment of the policy interest rates, had resulted in an increase in yield for Treasury bills and Treasury bonds.
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IMF Approves USD 1.5 Billion Extended Fund Facility for Sri Lanka
On 03 June 2016, the Executive Board of the International Monetary Fund (IMF) approved a three year Extended Fund Facility (EFF) of SDR 1.1 billion (approximately USD 1.5 billion) for Sri Lanka to support the balance of payments (BOP) position and in support of the government’s economic reform agenda. This amount is equivalent to 185 per cent of the country’s current quota with the IMF. The first tranche under the EFF amounting to SDR 119.9 million (approximately USD 168.1 million) will be made available to Sri Lanka immediately. The remaining amount will be disbursed in six tranches over a period of three years, with the final tranche is expected to be disbursed in April 2019. The interest rate applicable on the EFF, the basic rate of charge is equivalent to the SDR interest rate, which currently stands at 0.05 per cent per annum, plus 100 basis points.
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Release of 'Economic and Social Statistics of Sri Lanka - 2018' Publication
The 'Economic and Social Statistics of Sri Lanka - 2018' an annual publication of the Central Bank of Sri Lanka, is now available for public access.This publication contains economic and social indicators of Sri Lanka in the areas of national accounts, agriculture, industry, external trade and finance, government finance, banking and financial institutions, money and capital markets, prices and wages, population and labour force, transportation, education, health, telecommunication services, climate and selected information on economic and social indicators of other countries.
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Clarification Regarding False Information Published in the Media About Expenses Incurred by the Governor of the Central Bank of Sri Lanka
It has been reported in the media that allegations had been made by members of the Parliamentary opposition that the Governor of the Central Bank has misused public funds.
The CBSL wishes to state that neither the Governor nor any officer of the CBSL has used public money for personal expenses, or misused public funds in any manner whatsoever. The expenses relating to all official duties and events attended by the Governor and CBSL officials both locally and internationally are borne by the Central Bank of Sri Lanka, similar to the general practice of any other Ministry or Department.
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External Sector Performance - February 2016
Sri Lanka’s external sector showed a modest performance during the month of February 2016 as the trade deficit contracted and foreign currency inflows in the form of tourist earnings and workers’ remittances continued to record a steady pace of growth. Despite the decline in earnings from exports during the month, the larger decline in expenditure on fuel imports, food and beverages and transport equipment resulted in the contraction of the trade deficit. However, the government securities market and the Colombo Stock Exchange recorded net outflows during the period.
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Inflation in May 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, increased to 5.3 per cent in May 2016 from 4.3 per cent in April 2016, on year-on-year basis. Both Food and all Nonfood categories except for the Housing, Water, Electricity, Gas, and Other Fuels sub-category contributed towards the increase in year-on-year inflation.
The change in the NCPI measured on an annual average basis increased to 2.7 per cent in May 2016 from 2.6 per cent in April 2016.
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Monetary Policy Review - June 2016
According to provisional estimates of the Department of Census and Statistics (DCS), the Sri Lankan economy grew by 5.5 per cent, in real terms, in the first quarter of 2016 compared to the growth of 2.5 per cent recorded in the last quarter of 2015. Economic growth was mainly supported by the expansion of Industry and Services related activities, which grew by 8.3 per cent and 4.9 per cent, respectively, during the first quarter of 2016 in value added terms. Meanwhile, Agriculture related activities recorded a moderate growth of 1.9 per cent during this period. The growth rate recorded in the first quarter was broadly in line with expectations for the year.
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Commencement of Compensation Payment to CIFL Depositors
The Monetary Board cancelled the licence issued to Central Investment and Finance PLC (CIFL) with effect from 05.03.2018 in accordance with Section 37(3) of the Finance Business Act.
The Central Bank of Sri Lanka is pleased to announce the commencement of compensation payments for insured depositors of CIFL with effect from 27 August 2018 in terms of Sri Lanka Deposit Insurance Scheme Regulation No.01 of 2010 (as amended) (SLDILSS Regulations).
The payment process will be continued until all eligible depositors of CIFL who have claimed their dues are paid. Therefore, eligible depositors are kindly requested to wait patiently until CBSL officially inform the collection of their payment.
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Financial Intelligence Unit of Sri Lanka entered into a Memorandum of Understanding with Insurance Regulatory Commission of Sri Lanka
In terms of the provisions of the Financial Transactions Reporting Act, No. 6 of 2006 (FTRA), the Financial Intelligence Unit (FIU) of Sri Lanka entered into a Memorandum of Understanding (MOU) with the Insurance Regulatory Commission of Sri Lanka (IRCSL) on August 01, 2018 at the Central Bank of Sri Lanka to establish a framework for sharing information on supervisory findings based on comprehensive risk-based supervision focused on Anti-Money Laundering (AML) /Countering the Financing of Terrorism (CFT) in the Insurance Sector.