COLOMBO, May 10: Sri Lanka’s central bank cut its key monetary policy rates by 50 basis points on Friday, the first cut in five months, to boost faltering economic growth in the face of subdued demand and moderating headline inflation.
‘The Monetary Board has been somewhat concerned by the slower-than-expected pick-up in economic activity in the first few months of 2013 and has been of the view that there is now a need to stimulate the domestic economy,’ the central bank said in a statement.
It reduced both its repurchase rate and reverse repurchase rate by 50 basis points, taking them to 7.00 percent and 9.00 percent.
The bank held commercial banks’ Statutory Reserve Ratio (SRR) steady at 8 percent, but increased their reserve maintenance period to two weeks from one week from June 1 to give them greater flexibility in managing liquidity.
A Reuters poll of analysts forecast the central bank would hold the rates steady.
(AGENCIES)
Trending Now
E-Paper
Follow our WhatsApp channel