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Sri Lanka considers move to single policy rate

CBSL plans overhaul of monetary operations and improved liquidity forecasting

Sri Lanka Central Bank HQ building
The Central Bank of Sri Lanka
Amithasundar (https://bit.ly/3FMbD8F)

The Central Bank of Sri Lanka (CBSL) is considering whether to adopt a single policy rate, as it looks to boost the monetary transmission mechanism.

Governor P Nandalal Weerasinghe raised the possibility of the new rate framework in his annual statement on policy today (January 10). 

A single rate could “improve the monetary policy transmission and signalling effect of the monetary policy stance”, the governor said.

Many central banks use a range of interest rates to set monetary policy, though

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