The Central Bank of Sri Lanka increased the Statutory Reserve Ratio applicable to all rupee deposit liabilities of commercial banks by 100 basis points to 8% from 7% previously, effective April 29. In reference to the move the Bank said "While the excess liquidity in the domestic money market remains a concern, left unchecked, it could further expand monetary aggregates, leading to higher inflation than originally envisaged,". The Sri Lankan economy grew 8% in 2010, while inflation was last reported as 8.6% in March (7.8% in February this year).
www.CentralBankNews.info
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