Government of Sri Lanka’s (GoSL’s) demand pull inflationary face value money printing (FVMP) debt increased by Rs 1,409 million yesterday due to a persistent lack of revenue.
Consequently, GoSL’s FVMP debt on an overall basis increased by 0.08 per cent (Rs 2,493 million) to Rs 3,159,577.26 million (Rs 3.1596 trillion) yesterday. GoSL’s FVMP debt has been over Rs three trillion for a record consecutive 23 market days to yesterday due to a perennial lack of revenue.
GoSL’s at least theoretical MP borrowing costs (BCs) decreased by 4.78 per cent (Rs 6,394.75 million) to Rs 127,456.81 million yesterday, led by buying pressure of riskless, but “low” value Treasury (T) Bills and T Bonds in secondary market trading by investors, rather than lend to the private sector, the engine of growth, due to sustained uncertainty.
The country’s foreign reserves bled for the ninth consecutive market day to yesterday, with yesterday’s value alone being US$ three million (Rs 1,084 million), thereby increasing such haemhorraging to US$ 286.33 million in the review period led by the settlement of payments made in relation to making “essential” imports. Central Bank of Sri Lanka’s (CBSL‘s) Friday’s data showed that the country’s foreign reserves bled by $ 39 million last month due to such commitments. Nonetheless, CBSL lacks transparency in its open market operations.
By Paneetha Ameresekere