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Tuesday, the Monetary Board of the Central Bank of Sri Lanka decided to maintain the policy interest rates at their existing levels. The central bank retained the reverse repurchase rate at 11% and the repurchase rate at 8.5% for the second straight month.
The Monetary Board noted that market interest rates continue to ease in response to the measures adopted by the central bank, but they are yet to adjust fully to the policy rate reductions by the central bank.
Inflation is expected to increase moderately during the second half of the year. However, inflation on a yearly basis is forecast to stay at single digits level throughout this year. The decrease in interest rates and improved business sentiment is expected to support economic activity in the country during the remainder of the year.
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