Tuesday, 25 May 2021 09:13

CB Governor predicts lesser economic impact from latest COVID-19 wave Featured

Dispelling expert views of a severe impact on the economy in the third wave of COVID-19, Central Bank Governor W.D. Lakshman says that the economic impact of the current rising contagion is less than the two previous waves

Addressing the online monetary policy review media conference on Thursday, he noted that restriction of mobility in affected areas, ongoing vaccination programme and employees working from home will mitigate the impact.

However he said government tax revenues, public expenditure and exports could be disrupted by the pandemic.

The Central Bank is continuing the maintenance of the current accommodative monetary policy stance to support the sustained revival of the economy.

He emphasised the need of continuing fiscal and monetary support to place the recovery process on a firm footing.

Inflation is expected to remain broadly within the desired target range of 4-6 percent during the remainder of the year.

Sri Lanka has entered into a swap agreement with the People’s Bank of China, a US$ 500 million facility from the China Development Bank and funding from AIIB received by state banks.

The Finance Ministry has signed an agreement with the EXIM Bank of Korea to obtain a $500 million loan for development activities.

 

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