CB says market interest rates will decline

Tuesday, 02 April 2013 - 12:51


The head of the monetary authority of Central Bank said Sri Lanka’s market interest rates will ease this year as the Central Bank maintains a loose monetary policy stance despite high lending rates and a recent spike in Treasury bill yields.

Though the Central Bank surprisingly cut the reverse repurchase rate by 25 basis points to 10.5% from three-year highs in December, the average prime lending rates have been hovering around 14%.

However, Central Bank Governor Ajith Nivard Cabraal said the spike in T-bill yields was temporary and market interest rates would decline in future.