Financial Turmoil

Standing left to right – Mr. Dinesh Jebamani (Chief Manager Liability Product Management and New Age Media – Seylan Bank), Mr.Sudesh Peiris (Senior Manager – Digital Banking Channels – Seylan Bank), Ms. S.Senevirathne (Representative of the Revenue Department – Western Province), Mr. Tilan Wijeyesekera (Deputy General Manager – Retail Banking – Seylan Bank) and Mr. Malik Wickremanayaka (Deputy General Manager – Operations – Seylan Bank)

Nov 20, 2008 (LBO) – A senior Sri Lankan central banker says the collapse of the global financial sector has underlined the value of real output and resources but that it could dampen consumption. Central Bank Deputy Governor W A Wijewardena said that the entire financial market is now going through turmoil.

He was speaking at an international seminar on advanced techniques in risk management & Basel II.

He said the current global collapse was caused by excessive money printing by the Federal Reserve and other reserve currency central banks.

It is spreading from developed nations to other countries.

This loose monetary policy that some countries followed has given unnecessary financial income to people, raising demand.

The real sector should start showing ailment because sometimes we produce the output which is higher than the demand. Why should we produce the output? Because we give a financial income to the people, he said.

When we come to monetary policy sometimes we may have to blame the monetary authorities of those countries,” he said.

This was because what happens usually is that when a country has had some kind of financial stab