Sri Lank PM forecasts lending rates at 10-pct by end July

ECONOMYNEXT – Sri Lanka’s Prime Minister Ranil Wickremesinghe has said that lending rates will fall to 10 percent by end July 2019, an tourist arrivals will also increase.

"We have made arrangement for lending rates to fall to 10 percent from 12 percent," Wickremesinghe was quoted as saying at a forum in Trincomallee, where he was giving away free hold land titles.

"We think it will help a large number of people."

It is not clear what rate Wickremesinghe was referring to. Sri Lanka’s average prime lending rate, at which the best repaying (usually large) customers are given loans fell to 10.97 percent in the week ending July 12, down from 12.23 in late March.

Sri Lanka’s private credit is shrinking after a collapse of a soft-peg in 2018 and interest rates are falling.

The central bank is now keeping short term rates up with repo auctions. (Colombo/July15/2019)

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