As of July 2024, Sri Lanka’s central bank continues to face a challenging financial situation, with net foreign reserves remaining in the negative at US$728 million. This represents a significant improvement from mid-2022, when net foreign assets were deeply negative at US$4.6 billion. The drastic decline in reserves in 2022 was driven by borrowing through
First Capital (FC) anticipates that bank lending rates will remain within the 9-11% range for the rest of 2024 and rise slightly to 10-12% by mid-2025. This projection comes amidst slow economic conditions, weak demand for credit, and a lag in the reduction of new loan rates. The Average Weighted Prime Lending Rate (AWPLR) dropped
Sri Lanka’s private sector credit expanded by Rs. 60 billion in July 2024, following a Rs. 74 billion rise in June, according to official data. Meanwhile, credit to state-owned enterprises (SOEs) decreased during the same period. In July, banks extended Rs. 82.7 billion in loans to the government, with much of this being interest roll-overs,
Sri Lanka’s economy will remain stable under the National People’s Power (NPP) administration, according to party leader Anura Kumara Dissanayake. Addressing the business community, Dissanayake emphasized that while economic changes will be made, they will be carefully assessed to prevent any destabilization. Dissanayake assured that the NPP’s approach is not driven by populist politics, citing
Sri Lanka’s banking sector outlook has stabilized, with the Central Bank’s decision to prevent dividend repatriation playing a key role in the sector’s recovery. According to Maninda Wickramasinghe, Managing Director and CEO of Fitch Ratings Lanka Ltd., Sri Lanka can expect a sovereign rating upgrade immediately after the completion of its debt restructuring. At an
Sri Lanka’s budget deficit saw a significant reduction of 52% in the first half of 2024, dropping to 515.7 billion rupees. During the same period, government revenues surged by 42% to 1,860.6 billion rupees, driven largely by a 43% increase in tax revenues, totaling 1,709.3 billion rupees, according to interim budget data. The budget’s current
National consumer prices in Sri Lanka saw a slight increase in July, rising by 2.5% compared to the same month last year. This marks a modest uptick from the 2.4% increase observed in June, as the high base effects from the previous year began to dissipate. Despite this year-on-year rise, prices for many food and
Sri Lanka’s inflation is projected to remain below 3 percent through the first quarter of 2025, according to the Central Bank. This marks a breach of the lower threshold of the country’s 5 percent inflation target, which has been consistently maintained over the past several months. The Central Bank has proposed a 5 percent inflation
Sri Lanka’s positive economic growth, seen in early 2024, is likely to continue, supported by low inflation and a stable exchange rate, according to Central Bank Governor Nandalal Weerasinghe. In the first quarter of 2024, the country’s economy expanded by 5.3 percent, as estimated by the state statistics office. Speaking at an international forum organized
Sri Lanka’s remittances surged by 10.3% to $566.8 million in July 2024, marking a significant rise from the previous year, thanks to increased use of official banking channels by expatriates. State Minister of Finance Shehan Semasinghe announced on X (Twitter) that the total remittances for the first seven months of the year have reached $3.71