The Central Bank of Sri Lanka (CBSL) has decided to keep the policy interest rate that determine the interest rates of commercial banks unchanged for March as well while stating that inflation would remain low and that loans obtained by the private sector and economic activities have increased.

Loans obtained by the private sector during December had risen to Rs. 76 billion but had however dipped to Rs. 21 billion during January 2015, the CBSL stated.

However, the Bank says the loans obtained by the private sector would further remain high due to the lower interest rate and increasing business confidence.

It is stated that the low interest rate would continue and that the low inflation would assist this.

However, a significant feature this time is the CBSL being silent on the loans obtained from the banking system by the government sector and the Central Government.

Sri Lanka’s economy rose by 7.4 per cent during 2014 whereas the rise was 7.2 per cent during 2013.