Sri Lanka does not want rupee to fall ‘too quickly’: CB chief

Sri Lanka’s central bank does not want to allow the rupee currency to fall too quickly and wants to ensure a competitive exchange rate, the island nation’s Central Bank Governor Indrajit Coomaraswamy said on Tuesday.

U.S. dollar inflows have helped the rupee stabilize and eased the downward pressure. The central bank, however, has been adjusting the spot rupee reference rate weaker.

“The key thing is to have a competitive exchange rate…We don’t want to let it fall too quickly,” the central bank chief told reporters in Colombo after the monetary policy rate announcement.

He also said the central bank aimed to reduce overall credit growth to 15 percent year-on-year by end of this year from around 18 percent at end 2016.

“Private sector credit growth is still high. When the government last year imposed tight fiscal conditions, state banks lent mostly to the private sector.”

(Source: Reuters)