COLOMBO, March 24 Sri Lanka's central bank
raised its benchmark interest rates by 25 basis points each on
Friday for the first time in eight months, saying tightening of
monetary policy was necessary to contain the build-up of adverse
The central bank warned of the possible acceleration of
demand side inflationary pressures through excessive monetary
and credit expansion.
The Central Bank of Sri Lanka raised the standing deposit
facility rate (SDFR) and the standing lending facility rate
(SLFR) to 7.25 percent and 8.75 percent, respectively. (bit.ly/2oaPuGO)
It last raised its policy rates in July, keeping rates
steady for months despite pressure on the fragile rupee and high
A Reuters poll this week showed economists were split on
their views. Eight out of 15 economists surveyed predicted the
central bank would keep both rates unchanged.
However, the rest expected at least a 25-basis-point hike in
one of the two policy rates.
(Reporting by Shihar Aneez and Tanvi Mehta; Editing by Randy
Fabi and Jacqueline Wong)