The attention of the Central Bank of Sri Lanka (CBSL) has been drawn to recent newspaper articles on increased money printing by the CBSL in the past few days. The CBSL wishes to provide the following clarification as the concepts and facts in such articles remain grossly inaccurate and misleading:

These articles suggest that the CBSL has printed a large amount of money recently to help finance the government’s fiscal commitments. Usually, money printing refers to the expansion of Reserve Money (Monetary Base). Reserve Money, which was at Rs. 939.8 billion at end 2017 and at Rs. 1,010.5 billion at end September 2018, was recorded at Rs. 1,020.8 billion on 2 November 2018. This is a year-on-year growth in Reserve Money of 11.6 per cent, which is well within the CBSL projections for the year.

Provincial Gross Domestic Product (PGDP) estimated by the Statistics Department of the Central Bank of Sri Lanka (CBSL) by disaggregating the annual nominal Gross Domestic Product (GDP) figures published by the Department of Census and Statistics (DCS), using provincial indicators, shows that the Western Province continued to account for the largest share of the country’s nominal GDP. However, in line with recent trends, its share in the GDP declined in 2017, contributing to narrowing of regional disparity. Central and North Western provinces were the second and third highest contributors to the national GDP in nominal terms.

During 2017, increases in PGDP shares could be observed in Eastern, North Western and Uva provinces, while that of Western, Southern, North Central and Sabaragamuwa provinces decreased. The shares of Central and Northern provinces remain unchanged.