Sri Lanka central bank on gold sales

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)

June 14, 2011 (LBO) – Sri Lanka’s central bank said it does not sell gold in the domestic market, but only in the international market adding that it was making the statement in response to recent reports. “The Central Bank manages the official international reserves of the country and maintains its foreign currency balances in reputed international banks overseas in foreign currency denominated instruments and gold,” the monetary authority said.

“The Central Bank conducts transactions in gold only in the international market, as a part of its international reserve management operations.”

Last year the Central Bank sold gold to shore up its flagging profits. A central bank cannot make large profits without inflating the economy heavily or depreciating the currency.

According to international official gold holdings data, Sri Lanka’s gold reserves fell to 11.8 tonnes in June 2011 from 15.3 tonnes last year.