COLOMBO, March 8 (Reuters) - Sri Lanka's central bank kept
policy rates unchanged for a third straight month on Friday, as
expected, saying inflation is expected to ease soon and reach
more favourable levels by the end of the year.
"... the positive outlook for inflation is expected to
continue, supported by well contained demand and favourable
domestic and global supply conditions," the central bank said in
The central bank also said that although it had bought a net
$486 million from the market this year, it was seeing greater
stability in the rupee exchange rate owing to increased foreign
exchange inflows to the government securities market and from
tourism and private transfers.
The bank left the repurchase rate and the reverse repurchase
rate at 7.50 percent and 9.50 percent, respectively. It also
kept the commercial banks' Statutory Reserve Ratio (SRR) steady
at 8 percent.
The bank also said that it has been a matter of some concern
that two months after relaxing monetary policy, interest rates
pertaining to both deposit and lending interest rates still
remain high, but expects those rates to be adjusted in the near
term in line with its easing monetary policy trend.
A Reuters poll forecast that both rates would remain
unchanged from these levels, their highest in three years.
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Kim