Inflation ( CCPI)50.6% (Feb 2023)
GDP-12.4% (4Q 2022)
Unemployment5.0% (3Q 2022)
3M T-Bill Rate25.99%
12M T-Bill Rate24.31%
5Y T-Bond Rate27.00%/ 27.25%
10Y T-Bond Rate22.00% / 23.00%
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Reserves $2.22Bn (Feb 2023)
Cum. Trade Deficit $449Mn (Feb 2023)
Cum. Fiscal DeficitLKR 1,601Bn (Nov 2022)

CBSL hikes interest rate at a surprise move

Interest RatesMar 3, 2023
CBSL hikes interest rate at a surprise move
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CBSL raised benchmark interest rate s by 1.0% (14.50% to 15.5%). In the statement, CBSL stated that “Given the necessity of fulfilling all the ‘prior actions’ in order to move forward with the finalization of the IMF arrangement, the Board and the IMF reached consensus to raise the policy interest rates, in a smaller magnitude”

CBSL says it had purchased FX from the market amounted to USD 300Mn during the last few days, which is also expected to improve the LKR liquidity by over LKR 100Bn. It indicates that despite the policy rate increase of 1%, CBSL does not expect the secondary market interest rate to increase.

It further implies that, IMF will approve the rescue package during this month, which will help to improve the confidence further.


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