• Insists home-grown solution working well

Central Bank Governor Nivard Cabraal yesterday ruled out a depreciation of the rupee as well as the Government opting for an IMF program, saying “home-grown” solutions are delivering desired results.

“We won’t depreciate the rupee” was the direct answer Cabraal gave to a question at the post-Monetary Policy Review meeting yesterday on speculation of a devaluation of the currency by end of first quarter or later. 

The rupee depreciated by 7% against the dollar last year whilst since October the currency has been managed with cap of Rs. 203 for the dollar. 

Cabraal also ruled out the Government opting for a program with the International Monetary Fund (IMF). 

“Why do we need an IMF program?” said Cabraal in response to another question, implying that the home-grown solution was working. “We don’t need two or three different programs as our program is working,” stressed the CBSL Chief, adding that it has been carrying out almost all practical measures that the IMF may suggest.

Cabraal reiterated that Sri Lanka settling the $ 500 million worth of maturing International Sovereign Bonds (ISBs) on Tuesday proved critics and sceptics including rating agencies wrong. He pointed to the full subscription of an all-time high Treasury bill auction of Rs. 97 billion on Wednesday, reflecting investor confidence and that it would not have been the case if Sri Lanka had defaulted as some business leaders and economists wanted. 

CBSL takes new key measures to boost macroeconomic stability