The Monetary Board of the Central Bank of Sri Lanka has decided to increase the Fixed Deposit Facility Rate (SDFR) and the Fixed Loan Facility Rate (SLFR) of the Central Bank by 50 basis points to 5.50 per cent and 6.50 per cent, respectively.

 Meanwhile, the bank rate will automatically rise to 9.50 per cent, adjusting with the regular credit facility rate.

However, the Monetary Board has decided to maintain the statutory reserve ratio at the current level of 4.00%.

The decision by the central bank has been called a “compression monetary policy”.