The Monetary Board of the Central Bank of Sri Lanka has decided to maintain the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Central Bank at their current levels of 11.00 per cent and 12.00 per cent, respectively.
The Board arrived at this decision, at its meeting held on 23 August 2023, following a careful analysis of current and expected developments in the domestic as well as the global economy, while noting the significant easing of monetary conditions effected since June 2023, the CBSL said.
The Monetary Board took note of the downward adjustment of market interest rates in response to monetary policy easing measures implemented thus far and the need to allow space for further adjustment of market interest rates swiftly, the release said.
However, the Board observed that market interest rates of certain lending products remain excessive and are not in line with the current monetary policy stance.
Moreover, the Board anticipates a faster reduction in overall market lending interest rates in line with the recent monetary policy easing measures.
Accordingly, the Board decided to adopt targeted administrative measures to reduce specific lending interest rates that it considered to be excessive and direct the licensed banks to reduce overall rupee lending interest rates by an appropriate margin in the period ahead, the central bank said.