At an urgent meeting to review the monetary policy stance of the impact of Coron on the Sri Lanka economy, decided to reduce the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Central Bank by 25 basis points to 6.25% and 7.25%, respectively, with effect from 17 March 2020 and to reduce the Statutory Reserve Ratio (SRR) on all rupee deposit liabilities of licensed commercial banks (LCBs) by 1.00 percentage point to 4.00%. The Central Bank reemphasises the need for all financial institutions led by licensed commercial banks to ensure the full benefit of the cumulative reduction of 75 basis points in policy interest rates thus far during the year as well as the reduced cost of funds through the reduction in SRR is reflected in market lending rates without further delay. In addition, the Central Bank requests financial institutions to refrain from engaging in speculative activity which could lead to panic in the financial market.
Sri Lanka cuts interest rate by 0.25 percent and SRR by 1 percent
Interest RatesMar 16, 2020