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Tuesday June 18th, 2024

Sri Lanka rupee closes weaker, bond yields down

ECONOMYMEXT- Sri Lanka rupee closed at 185.85/186 lower on Monday while stocks fell 0.08 percent and bond yields eased marginally, dealers said.

Rupee closed on Friday at 185.30/40 against the greenback.

Liquidity in the overnight money market was 89.72 billion rupees, down from 88.19 billion rupees on Friday.

Banks deposited 104.19 billion rupees in Central Bank’s excess liquidity window.

In the equities market, Colombo’s main, All Share Price Index (ASPI) fell 4.00 points to close at 4,910.83.

S&P SL20 index of most liquid stocks down 0.38 percent or 7.74 points to 2,047.22.

Market turnover was 1.68 billion rupees with 40 stocks gaining and 93 stocks sliding.

Cargills (Ceylon) stocks contributed most to ASPI’s fall, sliding 16.20 rupees (8.34 percent) to trade at 178.10 rupees a share.

John Keells Holdings stocks down 1.30 rupees to trade at 113.60 rupees a share while Commercial Bank of Ceylon stocks fell 80 cents to close at 68.00 rupees a share.

In the secondary government securities market, yields were marginally down in active trade, dealers said.

A bond maturing on 01.08.2021 closed at 6.90/7.05 percent on Monday unchanged from Friday’s end.

A new 2-year bond maturing on 15.12.2022 closed at 7.50/57 percent on Monday, easing from 7.53/58 percent at Friday’s close.

A bond maturing on 15.01.2023 closed at 7.60/65 percent, down from 7.61/64 percent.

A bond maturing on 15.09.2024 15/20 closed at 8.15/20 percent on Monday, falling from 8.17/22 percent at previous day’s close.

A bond maturing on 15.10.2027 closed at 8.70/75 percent, up from 8.65/75 percent on Friday’s close.


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Sri Lanka’s Ceylon Chamber links up with Gujarat Chamber

ECONOMYNEXT – The Ceylon Chamber of Commerce has signed an agreement with the Southern Gujarat Chamber of Commerce and Industry (SGCCI) to increase trade cooperation between India and Sri Lanka.

The MOU was signed by CCC CEO Buwanekabahu Perera, SGCCI President Ramesh Vaghasia, in the presence of Dr Valsan Vethody, Consul General for Sri Lanka in Mumbai, India.

“With the signing of the MoU, … the Ceylon Chamber of Commerce and SGCCI aim to facilitate trade between the two countries via initiatives such as trade fairs and delegations, business networking events, training programmes,” the Ceylon Chamber said in a statement.

“This partnership will open doors for Sri Lankan businesses to explore opportunities in Surat’s dynamic market and enable the sharing of expertise and resources between the two regions.”

Established in 1940, SGCCI engages with over 12,000 members and indirect ties with more than 2,00,000 members via 150 associations. It promotes trade, commerce, and industry in South Gujarat.

The region’s commercial and economic centre Surat has risen to prominence as the global epicenter for diamond cutting and as India’s textile hub, and is ranked the world’s 4th fastest growing city with a GDP growth rate of 11.5%

Surat’s economic landscape is vibrant and diverse. As India’s 8th largest and Gujarat’s 2nd largest city, it boasts the highest average annual household income in the country.

The nearby Hazira Industrial Area hosts major corporations like Reliance, ESSAR, SHELL, and L&T. (Colombo/Jun18/2024)

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Sri Lanka telecommunications bill some clauses ruled unconstitutional by SC: Speaker

ECONOMYNEXT – Sri Lanka’s Supreme Court has found a number of clauses in a proposed amendment to the Telecom Telecommunications Amendment bill unconstitutional, speaker Mahinda Yapa Abeywardana said.

“Clause No 8, proposed section 9A 2 of the bill is inconsistent with Article 12 1 of the constitution, however this inconsistency shall cease if word ‘may’ will be replaced with word ‘shall’ as set out in the determination of the supreme court.”

“Clause No 9 is inconsistent with Article 12 1 of the constitution and only can be passed with special majority required under paragraph 2 of the Article 84. However, the inconsistency shall cease if clause is amended as set out in the determination of the supreme court.

Clause No 12, proposed section 17 10 of the bill is inconsistent with Article 12 1 of the constitution and can only be passed with special parliament majority required under Article 84 paragraph 2. However, the inconsistency shall cease if clause is amended as set out in the determination of the supreme court.”

Sections of clauses 13, 18, 20, 33 and 35 were also in violation of the constitution, and could only be passed by a special majority of parliament. (Colombo/Jun18/2024)

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Sri Lanka to exempt one house from imputed rent wealth tax: President

ECONOMYNEXT – Sri Lanka will exempt one house from a proposed wealth tax outlined in an International Monetary Fund program, President Ranil Wickremesinghe said.

About 90 percent of the people’s houses are likely to be exempt from the proposed tax, he said.

“[O]ne house will be exempt from this,” President Wickremesinghe told parliament Monday.

“It is going to have a very high threshold and I do not think the vast majority of the people in this country should even be worried about their house

“Don’t worry your house will be safe.”

The IMF program document however did not mention an exempt on one house, but did mention a threshold.

Taxing houses and thrift in general could have detrimental effects on people’s well-being housing stock and their willingness to remain in the country without migrating, critics say.

Related Sri Lanka to tax imaginary rents on houses under IMF deal

The mechanism of imputed rents was used because rates on houses was assigned to provincial councils and courts could strike it down.

Opposition legislator Harsha de Silva said the Samagi Jana Balwegaya welcomed President Wickremesinghe’s statement. (Colombo/June18/2024)

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