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HEADLINES - 2nd October 2018


Fitch affirms ratings on nine Sri Lankan banks; outlooks stable – DailyFT

Fitch maintains the Negative Outlook for the banking sector as operating conditions continue to be difficult against a challenging macroeconomic backdrop, which it expects to continue to pressure bank performance in the short to medium term. Non-Performing Loans (NPLs) continued to rise in 1H18 in the aftermath of strong credit growth as indicated by Fitch's Macro Prudential Indicator of 2 for Sri Lanka. There has also been an increase in rescheduled loans across Fitch-rated banks, indicating that pressure on asset quality is likely to extend into 2019.


Climate change funds available to businesses – Daily News

There are many international funding sources that businesses can tap to build resilience to the impacts of climate change but which are not adequately made use of, according to Attorney-at-Law Lalanath de Silva, a public interest litigator in the area of environment. The impacts of climate change are already being felt with regular cycles of floods and drought that are increasing in frequency and intensity. It is of utmost importance for Sri Lanka to build physical and financial resilience to deal with the impact of disasters, De Silva told the CEO Forum of the Biodiversity Sri Lanka (BSL) on ‘Climate Change Challenges and Solutions for Sri Lankan Businesses’ recently.


UDA invests Rs. 25 b – DailyFT

Megapolis and Western Development Minister Patali Champika Ranawaka yesterday revealed that the Urban Development Authority (UDA) has invested over Rs. 25 billion this year, and rolled out a program envisaging a Rs. 200 billion investment to provide housing for shanty dwellers. The Minister made these remarks addressing a ceremony organised to commemorate the 40th anniversary of the UDA, held at the Sethsiripaya Administrative Complex in Battaramulla. Ranawaka said apart from the banks, no other State institution has invested in such a feat despite capacity.


Tourism earnings up 12.5% Jan-Aug – Ceylon Today

Tourism earnings during the first eight months as well as during the month of August this year reflected the same trend as arrivals to the country. According to the Central Bank, tourism earnings in August increased 4.9 per cent, while overall earnings during the first eight months increased 12.5 per cent.


Sri Lanka's 'permit' moratorium could cut $210mn vehicle imports – EconomyNext

Sri Lanka's moratorium on tax slashed 'permits' to politicians and state worker could reduce or shift an estimated 210 million dollars’ worth vehicle imports, based on officially available figures. At least 7,000 vehicles had been imported so far this year by public servants paying on average 3.6 million rupees less than the actual duty payable on those vehicles.


Fuel-led prices push September inflation up; but overall prices moderate from August – Daily Mirror

Fuel prices-led transport and other non-food items continued to nudge the prices in Colombo higher in September, but increased supplies in vegetables and coconut kept overall prices under check moderating the month’s inflation. 


Rupee extends recovery ahead of rate decision; stocks down – Daily Mirror

REUTERS: The Sri Lankan rupee closed firmer yesterday, further recovering from a record low touched last week as banks sold dollars ahead of the Central Bank’s monetary policy meeting while shares fell for a third straight session to hit a four-and-a-half-year low amid foreign outflows.


Bond yields increase further ahead of monetary policy announcement – DailyFT

The secondary market bond yields were seen increasing further yesterday ahead of the much anticipated monitory policy announcement due today at 7.30 a.m. The Central Bank kept its policy rates unchanged at its last announcement on 3 August. 


Gold slips as dollar firms amid Fed rate hike view – DailyFT

BENGALURU (Reuters): Gold prices dipped on Monday as the dollar firmed in the wake of indications from the U.S. Federal Reserve last week that it will pursue a tighter monetary policy.


Central Bank of Sri Lanka maintains policy interest rates at current levels – LBO

Monetary Board of the Central Bank of Sri Lanka, at its meeting held on 01 October 2018, has decided to maintain policy interest rates at their current levels. Accordingly, the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Central Bank will remain at 7.25 percent and 8.50 percent, respectively. The Board said it arrived at the above decision after carefully considering current and expected developments in the domestic and global economy, with the aim of stabilizing inflation at mid-single digit levels in the medium term to support growth.


Sri Lanka injects Rs123bn to sterilize dollar outflows – EconomyNext

Sri Lanka's central bank has injected around 123.21 billion rupees (about 730 million US dollars) to sterilize dollar outflows below the ceiling policy rate, in the second currency panic triggered by targeting dual anchors in 2018.


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