Inflation ( CCPI)4.0% (Aug 2023)
GDP-3.1% (2Q 2023)
Unemployment4.8% (4Q 2022)
3M T-Bill Rate18.12%
12M T-Bill Rate13.32%
2Y T-Bond Rate14.60%/ 15.00%
4Y T-Bond Rate14.50% / 14.90%
USD/LKR322/323
Reserves $3.60Bn (Aug 2023)
Cum. Trade Deficit $2,623 Mn (July 2023 cumulative)
Cum. Fiscal DeficitLKR 1,243 Bn (June 2023)

Prime lending rate of the two major state lenders declined substantially

Interest RatesSep 17, 2023
Prime lending rate of the two major state lenders declined substantially

The lower lending rate is essential for the economy to tune banks to positive growth territory. AWPLR increased marginally last week from 15.14% to 15.21% but the largest two-state lender’s (BOC, PB) individual AWPLR fell by 1% and 1.8% respectively. CBSL has given a benchmark to bring it down to 13.50% by the end of October.

The other two largest private lenders (COM, HNB) are currently providing loans at the lowest AWPLR, as state lenders are still struggling to pull the rate down due to the exposure of the SOEs.

Disclaimer

Charts represents an assessment of the market environment as of the date indicated and it is subject to change; and is not intended to be a forecast of future events or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice regarding the funds or any issuer or security in particular. The strategies discussed are strictly for illustrative and educational purposes and should not be construed as a recommendation to purchase or sell, or an offer to sell or a solicitation of an offer to buy any security. There is no guarantee that any strategies discussed will be effective.

The information presented does not take into consideration commissions, tax implications, or other transactions costs, which may significantly affect the economic consequences of a given strategy or investment decision. This document contains general information only and does not take into account an individual’s financial circumstances. An assessment should be made as to whether the information is appropriate in individual circumstances and consideration should be given to talking to a financial advisor before making an investment decisions.