Sri Lanka keeps policy rates unchanged

November 16th, 2011 - 1:58 pm ICT by IANS  

Colombo, Nov 16 (IANS) Sri Lanka has decided to keep its policy rates unchanged despite a drop in inflation and rapid credit expansion in its booming post-war economy, the Central Bank said here Wednesday.

During the past month two commercial banks made arrangements to infuse fresh capital to the value of $250 million from foreign sources, the Central Bank said in a statement.

It added that approval has been granted to 12 private companies to raise debt capital of approximately $63 million also from foreign sources during the same time, reported Xinhua.

“Growth in broad money continued into September 2011, with the year-on-year growth remaining high at around 20.7 percent since June 2011. The rapid expansion of credit obtained by the private sector has increased by over Rs.37 billion (about $4 million) on average per month in 2011.”

Accordingly, the Central Bank’s Repurchase rate and the Reverse Repurchase rate will be 7.0 percent and 8.50 percent respectively, while the Statutory Reserve Requirement will be at 8.0 percent.

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