Going forward, the Central Bank of Sri Lanka (CBSL) will announce a housing credit program for low and middle-income groups, Central Bank Governor Prof. W. D. Lakshman stated.

"While encouraging banks to mobilize deposits at reasonable interest rates to depositors the Central Bank would be looking at priority areas in the economy as indicated in the overall government policy directions to initiate appropriate credit and other programs. Given the widespread benefit to a very large number of people from such scheme we hope to soon begin with an announcement about a housing credit program for low and middle-income groups," Prof. Lakshman told media whilst addressing the monetary policy meeting in Colombo today (20).

Speaking further he also expressed the following:

“We have seen the end of the General Election, which has reconfirmed political stability that is needed to carry out the Government’s policy framework. Domestic economic activities in Sri Lanka have recovered relatively fast in spite of the contraction seen in our economic partner countries, which are still unable to distance themselves from COVID-19 related issues. We have observed greater stability in the external sector, sovereign bond yields have declined significantly, exports have rebounded and the trade deficit has improved. Excepting the last few days, the exchange rate was well-behaved, retaining the decided condition of stability. The overall positive developments in the external economic conditions head by facilitating measures taken by the Central Bank and the treasury enable us to envisage the year 2020 ending with external reserves stable after paying up all our debt repayment dues this year. Finally, the market lending rates are responding to ease monetary conditions."

"The negatives include the publication of the first-quarter GDP estimates indicating an economic contraction. With a sharper contraction expected in the second quarter, it is essential to have a strong rebound in the second half of the year. The weak global economic conditions likely to continue for some time and this will have a negative impact on the economy and its growth. Although interest rates have declined in general we are yet to see a growth in private sector credit."