DDR may help create a debt market rally for Sri Lanka: Fitch Solutions

By Sanath Nanayakkare

Cedric Chehab, Global Head of Country Risk at BMI, a Fitch Solutions Company said during a webinar last week that if Sri Lanka Domestic Debt Restructuring programme is implemented properly, it may help create a debt-market rally for Sri Lanka.

He said so presenting a webinar on Global Macroeconomic Update and Key Themes for 2023.

The webinar covered U.S.A, Eurozone, African and Asia Pacific regions on multiple macroeconomic aspects including Recession Risks, Banking Sector Risks, Inflation, Interest Rates, Chinese Growth Outlook, Key Political Risks to watch and Outlook for the US Dollar and Chinese Yuan Renminbi (CNY).

Responding to a question from The Island financial Review, Cedric Chehab said that domestic debt restructuring is a positive development for Sri Lanka.

“Although Sri Lanka is not out of the woods yet and still face a challenging second half of the year, the current developments are positive compared to 2022. The inflation in Sri Lanka is on a downward path in line with the policies and measures taken by the Central Bank of Sri Lanka and so are the interest rates. I think that, in this context, if the domestic debt restructuring programme works in line with its technicalities, it would be a reason to trigger a debt-market rally for Sri Lanka.”

Cedric Chehab is the Global Head of Country Risk at Fitch Solutions where he helps ensure the coherence of global macro and country risk strategy.