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CB maintains policy interest rates at current levels

  • 25 Jan 2023
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In consideration of the current and expected developments, both domestic and global, the Monetary Board of the Central Bank of Sri Lanka, at its meeting held on 24 January 2023, has decided to maintain the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Central Bank at their current levels of 14.50 per cent and 15.50 per cent, respectively.



The Board was of the view that the current monetary policy stance is appropriate to ensure that underlying monetary conditions in the economy remain sufficiently contained to drive inflation along the envisaged disinflation path.



While some downward adjustment in market interest rates has been observed lately, the Monetary Board is of the view that there is sufficient space for excessive market interest rates, including lending interest rates to Small and Medium Sized Enterprises (SMEs), to adjust downwards considering the recent improvements in domestic money market conditions and sentiments along with the moderation in the yields on government securities.



However, the Board was also of the view that the anticipated further decline in the yields on government securities due to the narrowing of risk premia is unlikely to result in a significant improvement in underlying monetary conditions.



The Central Bank said it will continue to closely monitor monetary conditions in the period ahead and will remain prepared to take swift and proactive measures, as appropriate

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