Central Bank retains current interest rates

Sri Lanka’s Central Bank on Wednesday left current benchmark interest rates unchanged.

The decision was made by the Monetary Policy Board, at its meeting held on Tuesday where it decided to maintain the Overnight Policy Rate (OPR) at the current level of 7.75 per cent, the banking regulator said in a statement.

The Board arrived at this decision after carefully considering evolving developments and the outlook on both domestic and global fronts. The Board was of the view that the current monetary policy stance will support steering inflation towards the target of 5 per cent.

The statement said imports have risen in recent months, contributing to a widening trade deficit. However, strong inflows from tourism and workers’ remittances have cushioned the impact on the external current account. 

Gross Official Reserves were maintained at above US$ 6 billion thus far in 2025, and supported by net foreign exchange purchases by the Central Bank. Expected additional inflows in December 2025 include receipts from the multilateral organisations. The recent depreciation pressure on the rupee has subsided with the improvement in foreign exchange liquidity. 

“The Central Bank will continue to monitor and assess incoming data on evolving domestic and global economic conditions and emerging risks. The Board remains prepared to implement appropriate policy measures to ensure that inflation stabilises around the target, while supporting the economy to reach its potential,” the statement added.