CB keeps doors open for further rate hikes should inflation stays stubborn

After delivering a much-anticipated rate hike, yet short of the size some expected, the Central Bank said it is ready to take further steps to rein in inflation and bring it to its desired 4 to 6 percent range, which is at least 12 to 18 months away at the best-case scenario and also contingent on global commodities prices.

CB raises policy rates again; says inflation could shoot up to 70%

Amid growing hyperinflation concerns, the Monetary Board of the Central Bank (CB) jacked up the policy interest rates by 100 basis points after a bumper 700 basis point hike in April.

T-bill yields jump over 400bps signalling another jumbo rate hike today

In line with the expectations, the Treasury bill yields jumped the most since April, signalling another bumper rate hike announcement today, as the Central Bank allowed the bill and bond yields to go up since last week amid the worsening economic crisis.

PM tells parliament any IMF deal could happen only in Aug.

Prime Minister Ranil Wickremesinghe yesterday told parliament that any deal with the International Monetary Fund (IMF) could only be struck if and when Sri Lanka shows its plans to restore debt sustainability, which he said could happen by August.

India could bail out SL as IMF rescue package appears to take time- economist

As China is in dilemma while the rest of the world has qualms over helping Sri Lanka, India could deepen its role in bailing out its debt-strangled neighbour by giving the leadership for the proposed donor consortium,

BOI launches five-year residence visa to entice foreign investors

In an effort to step up the nation’s game in luring in foreign direct investments (FDI), Sri Lanka’s investment promotion agency, the Board of Investment (BOI), launched yesterday the five-year residence visa programme dedicated to investors.

Sri Lanka makes progress towards IMF rescue package

Concluding its visit to Colombo, the International Monetary Fund (IMF) Staff mission said yesterday that their talks with the Sri Lankan authorities achieved significant progress on the economic reform programme,

PUCSL to complete unbundling of CEB’s distribution operations soon

Undertaking the first major reform in Sri Lanka’s electricity sector since 2002, the Public Utilities Commission of Sri Lanka (PUCSL) this week announced plans to complete the stalled unbundling of the Ceylon Electricity Board’s (CEB) distribution operations into four independent units over the next couple of weeks, with an aim to enhance efficiency and transparency of the country’s electricity sector.

Tourism industry renews call for moratorium extension

Sri Lanka’s tourism industry stakeholders yesterday warned that the industry is likely to further crumble if relevant authorities continue to delay in extending the necessary intervention.

PUCSL asks exporters to settle electricity bills in dollars

As a partial solution to find the required foreign currency to maintain power generation at the Norochcholai coal power plant, the Public Utilities Commission of Sri Lanka (PUCSL) is asking all exporters, including services exporters, to settle their monthly electricity bills in US dollars.

May tourism income halves deepening country’s forex crisis

Foreign exchange income from tourism, the largest services inflow to Sri Lanka after remittances, more than halved in May as the island nation’s economic crisis and the resultant social unrest appears to be getting worse.

First aerial mapping of SL petroleum resources to be presented at SEAPEX confab

Bell Geospace, the world leaders in gravity gradiometry, is gearing up to present the insights gathered from the first aerial mapping of petroleum resources in Sri Lanka at the prestigious South East Asia Petroleum Exploration Society (SEAPEX) Asia Pacific Conference in London.

Pressure mounts on Treasury yields again as economic woes run deeper

Bucking the weeks-long trend, upwards pressure was seen again on Treasury yields this week as primary dealers and bond investors bid higher amid the worsening economic crisis, which has engulfed the entire country, bringing it to its knees.

Soaring interest rates seen forcing banks to delay or cancel bond issuances

The soaring interest rates triggered by the jumbo key rate hike on April 8 have prompted the banks to either delay or cancel their corporate bond issuances as part of their Tier II capital enhancement journey, according to the banking industry sources.

Dollar crunch unravels SL’s decades-long transport crisis

Sri Lankans are in a catch-22 situation as they neither can use their private vehicles nor take public transport after decades of neglect and underinvestment in the latter, which was allowed to decay to its current dilapidated state, according to a transport sector expert.

Early fiscal data points to another year of blowout budget deficit in 2022

The early data available on the government’s fiscal performance in the first two months of 2022 indicated signs of yet another year of blowout budget deficit in 2022, after three back-to-back years of gaping budget holes, which was partially responsible for the current seismic economic crisis.

Sri Lanka comes to grinding halt as fuel runs out

Sri Lankan economy comes to a complete standstill from today as the country has run out of fuel, bringing all economic activities to an abrupt halt as the government declared holiday for most State sector services, suspended schools and universities and asked the private sector to work-from-home.

WB expects SL economy to contract by 7.8% in 2022

The World Bank (WB) expects Sri Lanka’s economy to contract by 7.8 percent in the year 2022, a grim outlook, due to the country battling with severe shortages in electricity, food and fuel.

May PMI subdued as economic crisis batters manufacturing and services activities

The economic crisis, which precipitated into an all out civil unrest, took massive toll on the country’s manufacturing and services activities in May with factories scaling down operations and people losing jobs in what appears to be a forerunner for a deeper contraction in the Sri Lankan economy in the scale that it has never seen before.

SL’s BOP hole deepens as foreign inflows run dry

Sri Lanka more than doubled its deficit in the balance of payment (BOP) in the first four months compared to the same period in 2021, as imports raced, remittances sank, direct investments fizzled out and the expected borrowings didn’t come through.

April imports show stubbornly high food bill sparking SL’s food security concerns

April external sector aptly demonstrated Sri Lanka’s over-reliance on imports for basic needs such as food, power and energy, and transport as expenditure on such categories stood out stubbornly high, making a strong case for the country to change its track if it is to emerge out of the current economic crisis, the worst in its post-independence history.

Remittance income up in May from April signalling positive trend

Worker remittances to Sri Lanka recovered from April levels, but still stand significantly below what the country received a year ago, reflecting the lingering challenges facing the authorities in restoring confidence in getting expatriates to use the official banking channels more when repatriating their moneys, which will directly help to import food, fuel, cooking gas and medicines.

Dhammika Perera exits boardroom to enter Parliament

Ending weeks of speculation, business tycoon Dhammika Perera yesterday resigned from the director boards of a number of listed companies he controls, where he served in the capacity of Chairman or Co-Chairman, to make way for his entry into politics.

PUCSL says will not allow unfavourable PPAs with private sector developers

Sri Lanka’s power sector regulator, the Public Utilities Commission of Sri Lanka (PUCSL) stressed that it would not allow the Ceylon Electricity Board (CEB) to enter into power purchase agreements (PPAs) with the private sector developers, including India’s Adani Group, violating the least cost principle.

PM requests IMF to expedite rescue package as Sri Lanka runs out of cash

Prime Minister Ranil Wickremesinghe in his capacity as the Finance Minister has requested International Monetary Fund (IMF) Managing Director Kristalina Georgieva Tuesday evening to expedite the process of staff-level agreement, which would then pave the way for the rescue package at least by September.

PM presents comprehensive reform package to emerge from worst crisis

Presenting what appears to be a comprehensive reform package, Prime Minister Ranil Wickremesinghe yesterday charted a three-phased path for the country to emerge from the current economic abyss caused by the pandemic, which was then compounded by extremely poor economic management.

Daily guidance on dollar/rupee rate has brought in greater stability to forex market: CB

The Central Bank yesterday said the daily guidance rate released on the exchange rate between the United States dollar and Sri Lankan rupee is delivering the intended results by way of bringing in greater stability to the domestic foreign exchange market, which otherwise would have delivered disastrous implications, due to the rupee’s free fall.

Printing money similar to giving high dose of sugar to diabetic

Taking a swipe at Prime Minister Ranil Wickremesinghe’s repeated comments to the effect of the government having to rely on printed money to pay for essential government bills such as payment of salaries and pensions in the ensuing months, the former Central Bank Deputy Governor, Dr. W.A. Wijewardena likened it to giving sugar to a diabetes patient, to reflect the severity of the move in aggravating the current problems in the economy.

Crisis-struck SL can’t use US $ 1.5bn China swap: Coomaraswamy

Crisis-struck Sri Lanka will not be able to access a US $ 1.5 billion credit line from China, as the latter is concerned the International Monetary Fund (IMF) could push for delays in repayments.

Shortage of imported beverages, new burning issue for tourism industry

Sri Lanka’s hard-hit tourism industry is faced with yet another hurdle in catering to its international guests, this time with the non-availability of imported liquor.