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Tuesday, 07 November 2017 - 14:03
Policy interest rates to remain unchanged
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Central Bank says considering the prevailing developments in the domestic and international macroeconomic environment, the Monetary Board, at its meeting held yesterday (6) was of the view that the current monetary policy stance is appropriate.
 
Accordingly, the policy interest rates of the Central Bank of Sri Lanka will remain unchanged at their current levels.
 
The Central Bank in a statement said that the decision of the Monetary Board is consistent with the objective of maintaining inflation at mid-single digit levels over the medium term and thereby facilitating a sustainable growth trajectory.
 
In the monetary sector, the growth of credit to the private sector from commercial banks continued to moderate in September 2017 as envisaged. Net credit to the government (NCG) also recorded a decline largely on account of the retirement of Treasury bill holdings of the Central Bank.
 
With repayments made by key public corporations, the declining trend in credit to public corporations observed since June 2017 continued in September as well.
 
With improvements in net foreign assets (NFA) of both the Central Bank and commercial banks, overall NFA of the banking system turned positive in September 2017.
 
The build-up of NFA also contributed to the expansion of broad money supply (M2b).
 
Meanwhile, in response to improved rupee liquidity in the domestic money market, some bank interest rates moved downwards in recent months, the Central Bank added.
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