Sri Lanka's overnight call money market last hit 32 percent in December 2000.
buy stromectol online buy stromectol online no prescription
The central bank has clamped down on banks borrowing through its discount window to six times a month.
Meanwhile an open market auction through which the bank usually injects money to the market has also not been conducted recently.
"We do not know whether the market is short or not or whether the central bank is going to conduct the auction," one banker told LBO.
"So we would borrow at whatever in the morning and square my position rather than taking a risk."
Dealers says offers were seen at 35 and 37 percent, indicating that some deals may have gone through at rates higher than 32 percent.
The Central Bank has tightened liquidity in the market in a bid to dampen inflation which hit a high of 20.5 percent in January, but using quantity restrictions rather than relying on a target rate, has increased volatility in the system.
The central bank's main discount rate, the reverse repo rate, is still 12 percent, which banks do not consider to be a sufficiently penal rate, with one-year treasury bill rates touching 14 percent.
Analysts say the current rate volatility is a result of the central bank tying to limit reserve money growth with discount rate that is not high enough, and instead trying to make up the shortfall with quantity rationing instead.
The juggling with rates and quantities increase volatility and the large gap between the discount rate and market rates also provide arbitrage opportunities. However the rationing has to some extent prevented banks from borrowing through the discount window and buying treasury bills with printed money.
buy cymbalta online buy cymbalta online no prescription
Analysts expect interbank markets to become liquid after the dollar bond settlement Friday.
Meanwhile equity market slid two percent with the benchmark all share losing 59 points and the Milanka 81 points.
Updated