Surging Demand

From left: Dr. Fernando Im, Senior Country Economist for Sri Lanka and the Maldives, The World Bank, Hon. Eran Wickramaratne, State Minister, Ministry of Finance and Mass Media, Dr. W A Wijewardana, Former Deputy Governor of the Central Bank of Sri Lanka, Prof. Indralal de Silva, Former (Chair) of Demography, University of Colombo, Prof. Amala de Silva, Department of Economics, University of Colombo at the panel discussion on "Demographic Change in Sri Lanka" moderated by Dr. Ramani Gunatilaka, International Centre for Ethnic Studies.

An election on top of the April festivities, created a bigger than expected demand for cash this year.
Currency in circulation rose by a massive Rs. 18 bn through March as the public continued to withdraw cash from the banking system.rn

rnldblquote In other years we see an extra demand of about Rs 10-12 bn during this period,
dblquote says Central Banks Head of Domestic Operations, Dr. D S Wijesignhe.rn

rnldblquote But this year we had to supply about Rs 18 bn, which is higher than we expected,
dblquote he told Lanka Business Online.rn

rnThe day before the elections people flocked shops to stock up in case curfew was declared after elections.rn

rnDemand for notes began to rise from March 2 and by April 08, currency in circulation had risen to Rs. 119.8 bn.rn

rnBut most of the money is expected to flow back to the Central Bank after the New Year festivities end next week.rn

rnThe Banks Currency Department also has to destroy higher than normal stocks of cash through next few weeks when soiled notes from the festive season go though the Central Bank.rnrn