CBSL briefs MPs on monetary policy and economic developments

On Jun 11, 2026

The Central Bank of Sri Lanka on Wednesday (10) conducted a briefing for Members of Parliament on the current monetary policy, exchange rate policy, economic stability, and recent economic developments.

According to the CBSL, the session was led by Governor Dr. Nandalal Weerasinghe and senior Central Bank officials.

The briefing provided insights on current policy measures and responded to questions and comments raised by Members of Parliament.

Held under the patronage of the Speaker, the programme provided an opportunity for Members of Parliament to engage directly with Central Bank officials and seek clarifications on the topics presented.

Key facts on the current state of the Sri Lankan economy :

Economic growth: Positive growth momentum has been sustained since Q3 2023, with the economy recording growth of around 5% in both 2024 and 2025.
Inflation : Inflation accelerated in recent months, reflecting the impact of upward adjustments to domestic energy and fuel prices amid the ongoing conflict in the Middle East.
Monetary Policy Stance : The Overnight Policy Rate (OPR) was increased by 100 bps in May 2026, after around 800 bps reduction since June 2023. Latest monetary policy tightening is expected to arrest demand-driven inflationary pressures, thus also supporting to anchoring inflation expectations of the economy.
Reasons for recent depreciation pressure on Rupee: Higher import expenditure, particularly fuel and vehicles. Lower foreign exchange inflows, particularly from tourism. Possible delay in the conversion of export earnings in anticipation of a depreciation of the rupee. Importers increasing orders and foreign exchange purchases to hedge against the expected depreciation.
Market Interest rates : In line with policy tightening, overall market interest rates continued to adjust upward.
Domestic Credit : Growth in domestic credit has been primarily driven by the continued expansion in private sector credit, while Net Credit to Government and Credit to Public Corporations have recorded net repayments in recent periods amid improvements in fiscal discipline.
Fiscal Sector Performance : Driven by continued revenue based fiscal consolidation measures, fiscal sector performance further strengthened, with all three key fiscal balances improving following the implementation of fiscal reforms. Sustained revenue enhancing measures, fiscal reforms and expenditure rationalisation significantly increased government revenue and constrained government expenditure, narrowing the budget deficit.

The CBSL presentation made at the briefing : https://www.cbsl.gov.lk/sites/default/files/cbslweb_documents/about/presentation_20260610_presentation_to_parliament_monetary_policy_and_exchange_rate_policy_of_sl_e.pdf (Newswire)

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