Interest rates hike after 8 mths
View(s):Sri Lankan interest rates have gone up for the first time in eight months, after the Central Bank (CB) on Friday announced a rate hike.
The CB’s Standing Deposit Facility Rate and the Standing Lending Facility Rate were lifted by 25 basis points each, to 7.25 per cent and 8.75 per cent, respectively, with effect from March 24.
The CB policy rates are the benchmark followed by the commercial banks. The Sunday Times in an online story on Monday March 20 hinted at a rate hike, saying “pressure is mounting on a possible hike in view of US Federal Reserve rates going up. Higher overseas rates have seen some outflow of foreign cash from bond and Treasury bill markets”.
The rates were increased twice last year, first on February 19, 2016 by 50 basis points and then on July 28, 2016 also by 50 basis points.