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Central Bank Governor on interest rates reduction

April, 3, 2014

There is no necessity for further reductions in interest rates for some time in the future and the Central Bank had already carried out the necessary reductions in Sri Lanka’s interest rates, said the Governor of the Central Bank of Sri Lanka.

Central Bank Governor Ajith Nivard Cabraal told AdaderanaBiz that instead of reducing interest rates by some 25 basis points, the Central Bank had recently reduced the policy interest rates which decide the interest rates of private commercial banks, by 50 basis points.

“Last time we reduced the policy interest rate by 50 basis points instead of reducing it by a small margin of 25 basis points,” said the Governor.

The Central Bank’s Monetary Board had recently decided not to change its interest rates which in turn affect the interest rates of commercial banks.

Accordingly, the current interest rates remain at 6.50 percent and 8.00 percent.