Sri Lanka's central bank decided to retain its key interest rates unchanged on Tuesday as policymakers viewed the current monetary policy stance as appropriate.
The Monetary Board of the Central Bank of Sri Lanka under the new governor, Arjuna Mahendran, kept its Standing Deposit Facility Rate unchanged at 6.50 percent and the Standing Lending Facility at 8.00 percent, the bank said in a statement. The Statutory Reserve Ratio remained at 6 percent.
This marked the 12th consecutive month of holding the rates steady.
With appropriate macroeconomic policies to boost domestic and foreign investor confidence, the board said the Sri Lankan economy is expected to record a robust performance in the period ahead.
Policymakers expect subdued demand pressure and the reductions in fuel prices in January together with the expected decrease in administered prices of key commodities to lower inflation in the months ahead.
Further, it is expected that the increasing trend in private sector credit disbursements can be sustained throughout 2015 providing the necessary impetus to the growth momentum of the economy.
The central bank is unlikely to see scope for rate cuts, given concerns about the potential risk of capital outflows in response to political uncertainty ahead of the parliamentary elections in April and expectations of rate hikes by the US Fed, Krystal Tan, an Asia Economist at Capital Economics, said.
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May 01, 2026 15:54 ET Central banks dominated the economics news flow this week with almost all major ones announcing their latest policy decisions and many boosted expectations for a rate hike in June. In other news, several countries released the preliminary data for first quarter economic growth. In the U.S., comments by Fed Chair Jerome Powell were also in focus as his term ends this month.