Sri Lanka Central Bank rejects recent news articles on increased money printing

Nov 07, 2018 (LBO) – Sri Lanka’s Central Bank on Wednesday rejected newspaper articles published about the increased money printing by the Central Bank in the past few days. The Central Bank says the concepts and facts in such articles remain grossly inaccurate and advised general public to refer to accurate technical articles that are published on the Central Bank website without being misguided by erroneous reporting by a handful of journalists. “These articles suggest that the CBSL has printed a large amount of money recently to help finance the government’s fiscal commitments. Usually, money printing refers to the expansion of Reserve Money (Monetary Base),” the Central Bank said. “Reserve Money, which was at Rs. 939.8 billion at end 2017 and at Rs. 1,010.5 billion at end September 2018, was recorded at Rs.
buy orlistat online buy orlistat online no prescription
1,020.8 billion on 2 November 2018. This is a year-on-year growth in Reserve Money of 11.6 percent, which is well within the CBSL projections for the year.” The Central Bank says rupee liquidity in the domestic money market has been in deficit since mid-September 2018, requiring the CBSL to conduct open market operations (OMOs) to provide adequate liquidity to the market, in addition to allowing market participants access to standing facilities at policy interest rates. “In view of the large and long term shortages of liquidity in the market, the CBSL conducted longer term reverse repurchase auctions and made outright purchases of Government securities mainly from the secondary market,” “These are regular monetary operations with market participants, which have no relevance to the government’s fiscal position or any particular political event.” The Central Bank further says that as a result of such OMOs, the net book value of the Treasury bill holdings of the CBSL (gross book value of Treasury bills plus the total value of reverse repos and standing lending facilities minus repos with the CBSL) was recorded at Rs. 224.4 billion on 2 November 2018. “However, on a gross basis, the CBSL holdings of government securities was Rs. 67.4 billion on 2 November 2018,” “The fact that the growth in Reserve Money has remained subdued shows that recent OMOs have not had an undue expansionary effect on money supply in the economy.”