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Sri Lanka keeps policy rates steady, credit to state easing: Central Bank

Nov 11, 2013 (LBO) - Sri Lanka kept its policy rate corridor steady at 6.50 percent to withdraw excess cash and 8.50 percent to inject money in to the banking system, saying the inflation outlook was benign and state credit demand was reducing. The date for the release of the next regular statement on monetary policy would be announced in due course.

In September credit to private business had risen to 20 billion rupees, and the state and state enterprise had paid back 50 and 25 billion rupees to the banking system, the Central Bank said.

The full statement is reproduced below:-

Monetary Policy Review – November 2013

As expected, the measures on monetary policy easing adopted by the Central Bank with the aim of further stimulating economic growth, have continued to yield the desired positive effects on key variables. While the recent monetary policy easing led to a reduction in short term interest rates almost immediately, it is envisaged that commercial banks too, would utilise the ample space available to ease medium to long term lending rates, resulting in further private sector investment growth, as well as a healthy level of credit growth to the private sector.

In September 2013, broad money growth incre

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