News
Central Bank prints money to the value of Rs. 450 billion from February to July
The Central Bank has printed money totaling more than Rs. 450 billion up to July since the last week of February this year.
It has pumped Rs. 164.9 billion in March and another Rs. 92.5 billion in April, totaling more than Rs. 257 billion in these two months alone, informed source said.
In the meantime, according to Treasury estimates, it is expected that government borrowings for 2020 on a net basis would be in the region of Rs. 1,257 billion.
However, a senior Treasury official told the Sunday Times that money printing or expansion of reserve money taking place since January this year would not result in picking up speed of the economy or increase inflation.
Usually, money printing refers to the expansion of reserve money (monetary base).
Sri Lanka’s reserve money (printed money) has decreased to Rs. 869 billion during the last week of July from Rs. 996.5 billion a month ago compared to Rs. 874.5 billion a year ago, Central Bank data showed.
This was mainly due to the decrease in currency in circulation and deposits held by commercial banks with the Central Bank.
Reserve money increased by 10.5 percent, on year-on-year basis, while the growth of broad money (M2b) increased by 13.2 percent on a year-on-year basis.
Total foreign borrowing on net basis would be Rs. 523 billion, while the balance will be borrowed domestically, data show.
The total borrowing limit approved by the Vote on Account for the first four months of 2020 amounted to Rs. 721 billion, within which the utilisation of government borrowings for the period from January 1 to April 30, 2020 was Rs. 629.9 billion, according to Finance Ministry data.
Total domestic and foreign borrowing limits to finance cash flow operations and development projects during the period amounted to Rs. 509.9 billion and Rs. 120 billion, respectively.