Harsha welcomes CB action to stabilise rupee

• Says continued relaxation of restrictions will help move  the rate to a stable equilibrium
• Two specific actions by the Central Bank also contributed positively to the rupee’s appreciation

By Yohan Perera  

Samagi Jana Balawegaya (SJB) MP Harsha de Silva yesterday  welcomed the action of the Central Bank to ensure the stability of the  Sri Lankan rupee.  

“Kudos to the @CBSL for sticking to the plan. It’s working.  As detailed in our Samagi Jana Balawegaya (SJB) economic blueprint in  which we have said continued relaxation of restrictions will help move  the rate to a stable equilibrium, with further action as per our  document,” Dr. de Silva said in his Twitter message.  

“Balance of payment difficulties and black market premium  in the official forex market will be eliminated by adjusting the  exchange rate to the equilibrium (market) level. This can be done  through a transitional phase of floating the currency to permit the market  to reveal the equilibrium rate, and then stabilizing that rate through  Central Bank intervention in the forex market,” he added, quoting the SJB  blueprint.  

Two specific actions by the Central Bank also contributed positively to the rupee’s appreciation on Thursday. They were, the relaxing of surrender rules on export proceeds to 15 per cent from 25 per cent and the increase of the daily forex trading band.