Sri Lanka money markets open quiet, stocks delayed in a rain-washed day

(L-R) : Jeevith Senaratne, Director Operations - Star Garment Group; Shanaka Rabel, Group Chief Digital and Transformation Officer - Stretchline Holdings Ltd; Janaka Botejue, Chairman – Bernard Botejue Industries; Sanjeewa Kodikara, Chief Information Officer- Hirdaramani Group

May 03, 2007 (LBO) – Sri Lanka’s inter-bank markets opened quiet after a two-day religious holiday with money at 13.25 percent, but stock trading was delayed in a rain washed morning, dealers said. The spot dollar was trading around 110.70 rupees in early trading.

The Colombo stock market did not open at the scheduled time of 9.30 am, in a morning rent by an intense electric storm and heavy showers that snarled traffic in the city.

The markets have been liquid in recent weeks with foreign inflows coming in, despite Central Bank action to drain liquidity.

On Monday money markets were awash with 16.5 billion in excess liquidity.

The state-owned Bank of Ceylon raised 210 million dollars last week through a syndicated loan.

Last Thursday the Central Bank brought reserve money to 251 billion rupees as required in their monetary policy road map, after overshooting the target in April partly due to a seasonal draw down from the banking system.

Meanwhile, inflation data released Monday showed that the bank’s tight monetary policy had brought inflation down for three months in a row.

Twelve month consumer price inflation fell to 16.3 percent in April against a high of 20.5 percent after loose monetary policy in 2006 caused inflation to rocket to 20.5 percent in January 2007.


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