The Central Bank of Sri Lanka (CBSL) wishes to make the following statement in relation to the article titled “Government and CB have abdicated vital statutory duty by not being able to deal with rupee depreciation” that appeared in various newspapers on 08th and 09th October 2018.

The Central Bank is statutorily charged with the responsibility of securing, so far as possible by action authorised by the Monetary Law Act (MLA), a) economic and price stability; and b) financial system stability, with a view to encouraging and promoting the development of the productive resources of Sri Lanka. While financial system stability is identified by the resilience of the financial system to internal and external shocks, price stability is generally defined as maintaining low and stable inflation, which leads to economic conditions that support high and sustainable levels of economic growth.

The Monetary Board of the Central Bank of Sri Lanka, at its meeting held on 01 October 2018, decided to maintain policy interest rates at their current levels. Accordingly, the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Central Bank will remain at 7.25 per cent and 8.50 per cent, respectively.

The Board arrived at the above decision after carefully considering current and expected developments in the domestic and global economy, with the aim of stabilising inflation at midsingle digit levels in the medium term to support growth.