Central Bank brings forward monetary policy announcement date to July 6

The Monetary Board of the Central Bank has brought forward the fifth monetary policy announcement for this year to July 06, from July 13.

At the last monetary policy announced on June 01, the Monetary Board slashed policy rates by 250 basis points, kicking off the policy easing cycle.

Sri Lanka this week approved a domestic debt restructuring plan, which only has implications on the Treasury bills held by the Central Bank and the bonds held by the superannuation funds.

Amid the maturity extensions and coupon cuts proposed on them, the yields are expected to drastically come down during next week.

After a five-day bank holiday, the markets will open on Tuesday.

The Central Bank governor said the conversion of the T-bills held by the Central Bank into bonds and the exchange of the T-bonds held by the superannuation funds against longer-term maturity T-bonds would be completed within the month of July.

The faster than expected deceleration in consumer prices in the last couple of months has also helped the Monetary Board to bring down the policy rates.

The Central Bank expects inflation to return to single-digit levels as early as July-August, due to the substantially higher base effects of last year.