The Central Bank of Sri Lanka held interest rates steady for a fourth straight month on Friday, saying it expected inflation to moderate despite private sector credit growth. The standing deposit facility rate (SDFR) and the standing lending facility rate (SLFR) were kept at 6.50 percent and 8.00 percent respectively.
"The Monetary Board will continue to closely monitor developments in the domestic as well as global markets and make appropriate adjustments to the monetary policy stance, as necessary," the central bank said in a statement. Ten out of 15 economists polled by Reuters had predicted Friday's decision, but some expected a rate rise to counter inflation and private sector credit growth which accelerated to a near four-year high of 28.1 percent in April from March's 27.7 percent. May consumer prices and core annual inflation rose to multi-month highs after the government increased value-added tax to help restrain a soaring budget deficit.