• Sri Lanka Purchasing Managers’ Index - May 2023

    In May 2023, Purchasing Managers Indices indicated an expansion in Services activities and a contraction in Manufacturing activities.

    Manufacturing PMI declined in May 2023, yet at a slower rate, indicating a month-on-month contraction in manufacturing activities. Accordingly, Manufacturing PMI recorded an index value of 46.2 in May, driven by decreases recorded in all the sub-indices.

    Services sector PMI returned to the growth territory recording an index value of 53.5 in May 2023 following the marginal drop observed in the previous month. This was led by the increases observed in New Businesses, Business Activities and Expectations for Activity. Nevertheless, Employment and Backlogs of Works continued to decrease during the month.

  • The Central Bank of Sri Lanka Relaxes its Monetary Policy Stance

    The Monetary Board of the Central Bank of Sri Lanka, at its meeting held on 31 May 2023, decided to reduce the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Central Bank by 250 basis points to 13.00 per cent and 14.00 per cent, respectively. The Board arrived at this decision with a view to easing monetary conditions in line with the faster than expected slowing of inflation, gradual dissipation of inflationary pressures and further anchoring of inflation expectations. The commencing of such monetary easing is expected to provide an impetus for the economy to rebound from the historic contraction of activity witnessed in 2022, while easing pressures in the financial markets.

  • External Sector Performance - April 2023

    The trade deficit continued to remain modest in April 2023, compared to a year ago, though it recorded a month-on-month increase for the second consecutive month.

    Workers’ remittances and earnings from tourism improved notably in April 2023, compared to the same period of the previous year.

    The notable appreciation of the exchange rate that commenced in early March 2023, continued through April 2023.

    Foreign investments in the government securities market recorded a notable net inflow during the month.

    Gross official reserves improved further by end April 2023 with the net absorption of foreign exchange by the Central Bank from the domestic foreign exchange market.

  • CCPI based headline inflation continued to record a sharp decline in May 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 25.2% in May 2023 from 35.3% in April 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 April 2023.

  • Sri Lanka Purchasing Managers’ Index - April 2023

    Purchasing Managers’ Indices for both Manufacturing and Services activities decreased in April 2023.

    Following the seasonal pattern, Manufacturing PMI decreased to 34.7 in April 2023, indicating a month-on-month contraction in manufacturing activities. Accordingly, Production, New Orders, Employment and Stock of Purchases subindices declined during April compared to the seasonal peak in March.

    Services sector PMI remained slightly below the neutral threshold recording an index value of 49.6 in April 2023, led by the decreases observed in New Businesses, Employment and Backlogs of Works. Nevertheless, Business Activities and Expectations for Activity continued to increase during the month.

  • Imposition/ Collection of Administrative Penalties by the Financial Intelligence Unit (FIU) to Enforce Compliance on Financial Institutions from 17 November 2022 to 31 March 2023

    By virtue of the powers vested under Section 19 (1) read together with section 19 (2) of the Financial Transactions Reporting Act, No. 6 of 2006 (FTRA), financial penalties are imposed on Institutions for non-compliance with the provisions of the FTRA. The penalty may be prescribed taking into consideration the nature and gravity of relevant non-compliance of the Financial Institution.

    Accordingly, as Sri Lanka’s regulator for Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT), the FIU collected penalties as indicated below, amounting to Rs. 5.5 million in total from 17 November 2022 to 31 March 2023 to enforce compliance on Financial Institutions. The money collected as penalties were credited to the Consolidated Fund.

  • CCPI based headline inflation declined sharply in April 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 35.3% in April 2023 from 50.3% in March 2023. The lower level of realised inflation compared to the projections made, was mainly due to higher than expected price decreases observed in Volatile Food and Non-Food items.

  • External Sector Performance - March 2023

    The trade deficit continued to remain modest in March 2023, compared to a year ago, though it widened notably compared to February 2023

    Workers’ remittances and earnings from tourism recorded a notable improvement in March 2023

    The exchange rate appreciated notably in March 2023 supported by improved market sentiments towards the finalisation of the IMF-EFF arrangement and improvements in liquidity conditions in the domestic foreign exchange market driven by policy relaxation allowed by the Central Bank

  • The Central Bank of Sri Lanka Releases its Annual Report for the Year 2022

    In terms of Section 35 of the Monetary Law Act No. 58 of 1949, the seventy third Annual Report of the Monetary Board of the Central Bank of Sri Lanka was presented today (27 April 2023) to Hon. Ranil Wickremesinghe, the President and Minister of Finance, Economic Stabilization and National Policies, by Dr. P Nandalal Weerasinghe, the Governor of the Central Bank of Sri Lanka.

  • Shortage of a Cash Bundle

    A shortage of a cash bundle worth Rs 5 million (Rs 5000 denomination) was discovered in a Vault of the Central Bank during the currency operations on 11.04.2023. An internal probe into the matter was commenced immediately, while a complaint was also lodged at the Fort Police Station. The police investigation is in progress. The Central Bank is taking necessary measures to thoroughly investigate the incident and strengthen the internal controls, processes, etc. It will also continue assisting the Police to carry out its investigations. 

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