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The Monetary Board of the Central Bank of Sri Lanka has decided to reduce the percentage of money that licensed commercial banks have to deposit in the Central Bank from 4% to 2% by 200 basis points.
The Central Bank of Sri Lanka stated that this decision will be effective from the period of maintaining reserves starting on the 16th.
The Central Bank of Sri Lanka stated that it is expected that about 200 billion rupees will be released to the local currency market as a result of this decision.
The Central Bank of Sri Lanka has indicated that it believes that as a result of the reduction in the cost of funds of the licensed banks, the banks will be able to lower the market interest rates further.
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