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Monday June 27th, 2022

Sri Lanka has open mind about IMF, will go if needed: Minister

ECONOMYNEXT – Sri Lanka’s government has an open mind about the International Monetary Fund and will go the agency in needed, cabinet spokesman Minister Ramesh Pathirana said.

“The government has an open mind about IMF,” Minister Pathirana told reporters. “We have got support from the IMF on many occasions in the past.

“If needed we will take action to get support from the IMF.”

Sri Lanka has a soft-pegged central banks which prints money to keep interest rates down or to finance the deficit and frequently triggers forex shortages and is forced to depreciate the currency.

The central bank has gone to the IMF 16 times.

Sri Lanka needs higher interest rates to slow domestic credit, higher taxes to cut the deficit and also slow domestic credit to reduce forex shortages.

A float is usually needed to stop foreign reserves sales for imports, which are automatically sterilized through domestic operations of the central bank with more money printing. (Colombo/Feb23/2022)

Comments (1)

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  1. Krishant Salgado says:

    Many spokesperson saying different things. Whom do we believe?

View all comments (1)

Comments (1)

Your email address will not be published.

  1. Krishant Salgado says:

    Many spokesperson saying different things. Whom do we believe?