Business

The Central Bank of Sri Lanka maintains policy interest rates at their current levels

Published

5 years ago

2021/11/27

Sahan Weerasooriya

CBSL Governor Ajith Nivard Cabraal addresses the media

Monetary Policy Review: No. 08 – November 2021

The Monetary Board of the Central Bank of Sri Lanka, at its meeting held on 24 November 2021, decided to maintain the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Central Bank at their current levels of 5.00 per cent and 6.00 per cent, respectively. The Board arrived at this decision after carefully considering the macroeconomic conditions and expected developments on the domestic and global fronts. The Board noted the recent acceleration of inflation, driven mainly by supply disruptions and the surge in global commodity prices, and reiterated its commitment to maintaining inflation at the targeted levels over the medium term with appropriate measures, while supporting the economy to reach its potential in the period ahead.

The Sri Lankan economy is gradually recovering The Sri Lankan economy witnessed a strong recovery during the first half of 2021, supported by fiscal and monetary stimulus measures. The re-emergence of the COVID-19 pandemic and the resultant disturbances to production activities appear to have affected the ongoing recovery somewhat during the third quarter of 2021. However, the available high frequency indicators suggest that economic activity is fast returning to normalcy. The removal of COVID-19 related lockdown measures in October 2021 and the successful nationwide COVID-19 vaccine rollout would help activity in the period ahead. While real GDP growth is projected at around 5 per cent in 2021, the ongoing rise in COVID-19 infections both globally and domestically could impact this expectation to some extent.

The external sector remains resilient against strong headwinds Earnings from merchandise exports remained robust, recording over US dollars 1 billion for the fourth consecutive month in September 2021. Preliminary data show that merchandise exports have recorded an all time high in October 2021. Expenditure on imports also increased, widening the trade deficit during the nine months ending September 2021 over the corresponding period of the previous year.

The tourism sector has displayed strong signs of revival with the easing of restrictions. Despite subdued inflows on account of workers’ remittances in recent months, a rebound is expected in the period ahead with the continuous rise in worker migration and efforts taken to facilitate remittance flows through formal channels.

The depreciation of the Sri Lanka rupee against the US dollar is recorded at 7.2 per cent thus far in 2021. The exchange rate has remained stable at around Rs.200-203 levels against the US dollar during the past three months. Meanwhile, gross official reserves were estimated at US dollars 2.3 billion by end October 2021. This, however, does not include the bilateral currency swap facility with the People’s Bank of China (PBoC) of CNY 10 billion (equivalent to approximately US dollars 1.5 billion). Moreover, measures taken by the Government and the Central Bank to attract fresh forex inflows, as well as the anticipated inflows to the private sector, including the financial sector, are expected to augment gross official reserves, thereby strengthening the external sector in the period ahead. Specifically, a greater conversion of export proceeds is observed, while negotiations with the foreign counterparts of the Government and the Central Bank are progressing, broadly in line with the path envisaged in the Six-Month Road Map.

Market interest rates have increased, reflecting the passthrough of tight monetary conditions In response to the tight monetary and liquidity conditions, most market lending rates have adjusted upwards. Yields on government securities, which increased notably, have stabilised with enhanced subscriptions at primary auctions, reflecting improved market sentiments. Meanwhile, credit extended to the private sector, which expanded notably underpinned by eased monetary conditions, has slowed somewhat in September 2021.

However, data for the nine months ending September 2021 indicate that credit flows, particularly to the industry and services sectors of the economy, have improved significantly, thereby supporting the revival of the economy. In the meantime, credit obtained by the public sector from the banking system, particularly net credit to the Government, continued to expand. Overall, the growth of broad money (M2b) decelerated in September 2021, commensurate with the moderation of credit to the private sector and the decline in the net foreign assets of the banking system.

Inflation accelerated recently mainly due to supply side disturbances and the surge in commodity prices internationally Supply side disruptions, removal of domestic price controls and upward adjustments to several administratively determined prices to reflect the rising global energy and other commodity prices along with the gradual firming of aggregate demand conditions, have pushed inflation above the targeted levels recently. A further acceleration of headline inflation is possible in the immediate future, although such movements are expected to be transitory. The monetary policy measures already taken by the Central Bank will help curbing excessive demand pressures and preventing the buildup of adverse inflation expectations.

Policy rates are maintained

at current levels

In consideration of the current and expected macroeconomic developments as highlighted above, the Monetary Board was of the view that the current policy interest rates are appropriate. Nevertheless, the Central Bank will remain vigilant and continue monitoring domestic and global macroeconomic and financial market developments and will take appropriate measures, as and when necessary, with the aim of ensuring stability in the external sector, maintaining inflation in the desired range, and supporting sustained economic recovery.

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Business

The Ceylon Chamber’s Commercial Document Registration Division expands export support

Published

10 hours ago

2026/07/11

Thilina Walpola

The Commercial Documents Registration Division (CDRD) of The Ceylon Chamber of Commerce has expanded its export support services with the introduction of the Free Sale Letter for Pharmaceuticals, providing Sri Lankan pharmaceutical manufacturers and exporters with an additional document certification service to support their export processes and compliance requirements in international markets.

The new service expands CDRD’s portfolio of trade documentation solutions, which includes Certificates of Origin and the certification of key commercial documents required by overseas buyers, customs authorities, and regulatory bodies. These services assist exporters across sectors by helping ensure their documentation meets applicable requirements for international trade.

Established in 1925 as one of the authorised institutions to issue Certificates of Origin in Sri Lanka, CDRD has supported the country’s international trade for nearly a century. Today, the Division provides certification and verification services to exporters, manufacturers, freight forwarders, logistics providers, and other trade stakeholders, supporting businesses in meeting documentation requirements for global markets.

In addition to pharmaceutical certification, CDRD facilitates the certification of Commercial Invoices, Packing Lists, Price Lists, Health Certificates, Phytosanitary Certificates, Certificates of Analysis, Bills of Lading, Survey Reports, Beneficiary Certificates, and other export-related documents. The Division also issues Free Sale Letters and Surveyor Appointment Letters, while supporting exporters through the Ministry of Foreign Affairs’ Electronic Document Attestation System (e-DAS), enabling secure and efficient document authentication.

Through established processes, digital solutions, and its e-service platform, CDRD continues to enhance the efficiency and accessibility of trade documentation services. Available 24/7 and 365 days of the year, the platform enables exporters to submit and manage documentation requirements conveniently while ensuring that certified documents meet internationally accepted requirements. By providing reliable documentation support and adapting its services to changing trade needs, the Division assists Sri Lankan businesses in managing export requirements and accessing international markets.

For more information on obtaining commercial document registration services, contact Achala via achala@chamber.lk / 0115588886

Business

Siyapatha Finance unveils newest branch in Bandarawela

Published

10 hours ago

2026/07/11

Thilina Walpola

Siyapatha Finance PLC recently expanded its island-wide footprint with the successful inauguration of its 64th branch in Bandarawela. Strategically located in scenic hill town in the Badulla District, the latest branch offers convenient and wider access to tailored, customer-centric financial solutions.

The branch was ceremoniously declared open by Siyapatha Finance PLC Chief Executive Officer (CEO) Mathisha Hewavitharana, joined by Chief Operating Officer (COO)Rajeev De Silva, Ms.D.M. Dewmi Tharindi, a student of Bandarawela Dharmapala Vidyalaya who won the Under-18 Girls’ 3,000m event at the Junior National Athletics Championship, the Senior Management and staff members as well as Traffic OIC Kandasami, Trade Association Secretary Sunanda Rathnayaka, representatives of the government and private banks and insurance companies and well-wishers.

Sharing his thoughts, Siyapatha Finance PLC CEO Mathisha Hewavitharana remarked: “We are deeply honoured to be of service to the people of Bandarawela. Opening this branch is a pivotal step in our 2026 expansion strategy and a reflection of our commitment to strengthen our presence in Sri Lanka. It is a region that showcases potential for greater economic development primarily through the country’s traditional agricultural practices. We look forward to reaching as many different communities as possible in the coming years.”

The Bandarawela branch offers a comprehensive product portfolio including leasing, fixed deposits, gold financing, business loans, personal loans, fast draft, and factoring to Smart Pay, the Company’s bill payment facility. With a thorough understanding about the current socio-economic dynamics of the region, the well-trained team at the newest branch is dedicated to providing flexible financial solutions to aspiring individuals as well as small and medium-scale enterprises (SMEs).

Business

Dialog recognised as Sri Lanka’s Most Loved Service and Telecommunications Brand for third consecutive year

Published

10 hours ago

2026/07/11

Thilina Walpola

Dialog Axiata PLC, Sri Lanka’s #1 connectivity provider, has once again been recognised as Sri Lanka’s Most Loved Brand in the Service and Telecommunications sectors, while also ranking among the top Corporate Brands in the LMD Brands Annual. Marking its third consecutive year at the top of both categories, the recognition reflects the company’s commitment to enriching Sri Lankan lives and enterprises through technology, while creating value for customers, communities and the nation.

The accolades were awarded through the LMD Brands Annual survey, conducted independently by PepperCube Consultants on behalf of Media Services. Based on responses from 400 readers across Sri Lanka, representing a broad demographic and geographic mix, the survey identified the brands that resonated most strongly with consumers in terms of trust, loyalty and brand affinity.

Lasantha Theverapperuma, Group Chief Marketing Officer of Dialog Axiata PLC said, “Being recognised as Sri Lanka’s Most Loved Brand across both the Service and Telecommunications sectors is a meaningful endorsement of the trust and confidence that Sri Lankans continue to place in Dialog. This recognition reflects our commitment to understanding and serving the evolving needs of our customers while expanding access to digital connectivity, services and opportunities. As we continue to innovate and grow, we remain focused on creating value for communities and supporting Sri Lanka’s digital and socioeconomic progress.”

The recognition also reflects Dialog’s continued focus on innovation, customer-centricity and investments that support Sri Lanka’s digital future, including expanded 5G connectivity, AI-powered digital experiences and broader access to digital services.

Beyond connectivity, Dialog continues to support communities, livelihoods and the environment through initiatives such as Govi Mithuru, which provides AI-driven agricultural advisory services to over one million farmers, and Shishyadhara, which has enabled subsidy distribution to more than 450,000 underprivileged students. The company also continues to advance its Net Zero 2050 ambition through energy optimisation, renewable energy adoption and the expansion of solar-powered network infrastructure.

Further underscoring the brand’s standing among Sri Lankan consumers, Dialog was also recognised as the ‘Service Brand of the Year’ for the fifth time and the ‘Telecommunication Brand of the Year’ for the 15th consecutive year at the SLIM-KANTAR People’s Awards 2026.