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Saturday October 23rd, 2021
Bonds & Forex

Sri Lanka central bank denies ‘devaluation’ claims

ECONOMYNEXT – Sri Lanka’s banks have not been asked to ‘devalue’ the rupee the central bank said in response to some messages that started to circulate on August 17.

Sri Lanka’s rupee has come under pressure as money printed to target interest rates came up for redemption in forex markets.

The rupee has been sold at various rates to importers and being bought from exporters without a functioning interbank spot market to ensure price transparency.

On Tuesday banks published rates on their websites indicating 211 rupees for telegraphic transfers through some importers have been paying higher rates.

Market participants also said banks were asked to keep the rupee firm by the central bank rather than weaken it.

The full statement is reproduced below:

Licensed Banks have not been asked to “Devalue” the Sri Lanka Rupee

The Central Bank of Sri Lanka (CBSL) has observed messages being circulated claiming that licensed banks have been officially asked to devalue the Sri Lanka rupee with immediate effect.

The general public is hereby informed that there is no basis whatsoever for such claims, and the CBSL has not made any change to its stance or the operational arrangements on the determination of the exchange rate.

The public is also advised not to rely on false and misleading information that is being circulated through social and conventional media. Any official statement issued by the CBSL will be made by the Governor, Deputy Governor or any other authorised official of the CBSL identified by name and designation.

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