by Sanath Nanayakkare 

State Minister of Money and Capital Markets Ajith Nivard Cabraal said yesterday that there was no relationship between money printing by the Central Bank of Sri Lanka and the depreciation of the local rupee in the foreign currency market.

Minister Cabraal made this comment while responding to questions during an interview on Swarnawahini television.

When asked whether the value of the Sri Lanka rupee showed a negative correlation to a surge in money printing by the Cental Bank as the Opposition claimed, the state minister replied, “Generally, people say it maybe because they don’t know. The issue is when those that claim to be in the know of these matters also say the same thing.”

When asked whether this trend would continue to have an impact on food inflation thus passing the burden to the masses, Cabraal said, “We are mindful of the prices of commodities and we make decisions accordingly to address such issues. As a result of such policy action you see prices of goods and services come down and stabilize after having increased temporarily.

“We forecast that the rupee will value at around Rs.180 by end 2021 and if coronavirus threat reduces as expected, we should be able to achieve an economic growth rate of 7% by end of 2021’, the state minister opined.

“The value of the rupee against the US dollar has started to gradually strengthen again, so it won’t have much of an impact. It will turn around well. My advice is; get on with your activities according to your methodologies without being nervous about it, then no issue will crop up,” he said.