Central Bank failed to contain inflation – Eran

The Central Bank has failed in its two main responsibilities of controlling inflation and maintaining the stability of the financial system, SJB MP Eran Wickremaratne said. Wickremeratne warned the government that if the Central Bank was not allowed to maintain its independence as envisaged in the Monetary Law Act, and does not adopt a proper system to control inflation and financial stability, commodity prices will continue to rise to unaffordable levels.

Wickremaratne was addressing the media after having a discussion with the Central Bank governor at the Central Bank on Tuesday. MPs Kabir Hashim and Dr. Harsha de Silva participated in the discussion with the Governor and other senior officials about the Central Bank’s policies and the problems faced by the people as a result of rising commodity prices and the shortage of essential goods and services due to the dollar crisis.

Wickramaratne further elaborating on their discussions with CBSL Governor and the senior officials said the Opposition and economic experts from the very beginning alerted that this government is pursuing wrong policies, and as a result, the country would face even more crises if the central bank did not adopt the right approach to controlling inflation. He said that he was not satisfied with the method adopted by the Central Bank to control commodity prices and that the main reason that led to this deteriorating situation was the Central Bank did not act independently.

“We pointed out the current shortcomings of the Central Bank and made positive comments in this regard. The Yahapalana government amended the Monetary Law Act to enable the Central Bank to discharge its key responsibilities independently,” Wickramaratne said.