Flexible exchange rate - IMF

10 June 2011 12:58 pm - 8 - {{hitsCtrl.values.hits}}

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The IMF urged Sri Lanka's central bank on Friday to avoid continuous sales of foreign exchange and allow a flexible exchange rate to ease pressure on balance of payments.

Completing the seventh review of its $2.6 billion loan to the island, the International Monetary Fund said Sri Lanka's macro economic performance was satisfactory.

"Strong export growth and continued large remittance inflows have supported reserves. But going forward, rapid import growth and high oil prices could put pressure on the balance of payments," the IMF said in a statement.

"In this event, the central bank should allow the exchange rate to reflect market forces ... and avoid sustained sales of foreign exchange, ensuring that reserves remain healthy and the economy competitive." (Reuters)

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Comments - 8

Black Mamba Friday, 10 June 2011 01:18 PM

Another 'order' or else.......!

Bumba Friday, 10 June 2011 01:40 PM

The IMF in effect is saying to float the Sri Lanka Rupee which is now kept at an artificially high value. In effect it will be a devaluation of the Sri Lanka Rupee. This needs to be done.

mani Friday, 10 June 2011 04:07 PM

devaluation of the sri lankan rupee may lead to hyper-inflation.

palithaeka Friday, 10 June 2011 04:48 PM

If we open the exchange rate market we going to face a dangerous situation. But the artificially control market is also a risk.

Dinithi Friday, 10 June 2011 05:33 PM

We should always follow middle path. No full float. No full control.

kalum Saturday, 11 June 2011 06:13 AM

dont know where is this money???? its went in to the politicion pocket.

basila Saturday, 11 June 2011 10:27 AM

They are teaching us to follow the Middle Path "meda Mawatha" of Lord Buddhas

basila

Rajitha Sunday, 12 June 2011 03:16 AM

care to explain why? as far as i can tell devaluation of rupee will cause inflation

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Flexible exchange rate - IMF

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