Inflation ( CCPI)1.5% (Oct 2023)
GDP-3.1% (2Q 2023)
Unemployment5.2% (2Q 2023)
3M T-Bill Rate15.29%
12M T-Bill Rate12.94%
2Y T-Bond Rate14.45%/ 14.50%
4Y T-Bond Rate14.70% / 14.80%
Reserves $3.56Bn (Oct 2023)
Cum. Trade Deficit $3,307 Mn (Sep 2023 cumulative)
Cum. Fiscal DeficitLKR 1,614 Bn (Sep 2023)

CBSL expects rates to fell as inflation is slowing down in next few months

Interest RatesJan 2, 2023
CBSL expects rates to fell as inflation is slowing down in next few months

Banks’ FD rates are still rising (Nov) despite the T-Bill rates stabilized since September. The average FD rates are at 13.37% while new FD rates are offered at 23.63%, on the other hand, the average Lending rates are at 18.42% and new lending rates are at 26.04%.

Interestingly, the average deposit rates were at 4.82% one year ago and lending rates were at 9.79%, the gap was about 5%. Currently, the new deposit rate is at 23.63% and the new lending rate is at 26.04%, which means the gross spread has come down to 2.50%.

But the bank’s book carries low-cost & high-cost borrowing averaging 13.37% and low & high rate lending averaging 18.42% and keeping a 5.00% margin even in November. Therefore the overall books have not got an impact yet. The only issue is the recovery of lending and cash flows.


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