Sri Lanka increases key rates to 21-year high to fight inflation

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The Monetary Board of the central bank of Sri Lanka decided to increase the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) by 100 basis points to 14.50 percent and 15.50 percent respectively on Wednesday.

This was done to tackle the rising domestic inflation, the bank said, adding that these rates are at the highest in 21 years.

The central bank said that they had noted a higher-than-expected increase in headline inflation recently. The high inflation is expected to remain in the period ahead, thus the Monetary Board was of the view that a further monetary policy tightening would be necessary to contain any build-up of adverse inflation expectations.—Xinhua

 

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