COLOMBO : Sri Lanka's central bank is likely to continue to ease monetary policy, following a 250 basis points rate cut on Thursday, as it tries to boost economic growth and lower borrowing costs for the government in the crisis-hit economy.In a sign of confidence that the worst of Sri Lanka's financial c
COLOMBO : Sri Lanka's central bank is likely to continue to ease monetary policy, following a 250 basis points rate cut on Thursday, as it tries to boost economic growth and lower borrowing costs for the government in the crisis-hit economy.
Sri Lanka plunged into crisis last year as its foreign exchange reserves ran out, food and energy prices spiralled and protesting mobs forced the ouster of the country's then president. "This could be indicative of the likely need to pursue some domestic debt restructuring via the treasury bonds, which we think would help advance negotiations with the foreign creditors," they added.
"With no inflation risk the central bank will cut rates aggresssively to push demand and target growth."
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