The central bank indicated in a statement that the new standard interest means reducing the main interest rate by about 50 basis points, adding that the decision to ease monetary policy aims to “ensure the continued movement of the inflation rate towards the target level of 5 percent while supporting the economy to grow at its full capacity.”
Nadala Weerasinghe, Governor of the Central Bank of Sri Lanka, said in an interview with Bloomberg TV on Wednesday that the country has a sufficiently balanced monetary policy at the present time, indicating that the central bank does not see any risks threatening reaching the target inflation rate.
Bloomberg News Agency indicated that Sri Lanka It has failed to reach the target inflation rate since last March, while recording a price contraction since last September.
The Central Bank of Sri Lanka said yesterday that it will use the overnight interest rate as a primary tool to “indicate and operationalize its monetary policy stance.” The new benchmark interest rate will replace a two-meter system under which the central bank has cut interest rates by 725 basis points since the monetary policy easing cycle that began in April 2023.
