Millennium Post (Kolkata)

Sri Lankan economy records 4.5% growth in Q4 of 2023: Central Bank


COLOMBO: After six successive quarters of negative growth, Sri Lanka’s bankrupt economy is estimated to have recorded a growth of 4.5 per cent year-on-year in the fourth quarter of 2023, the Central Bank announced here on Tuesday.

It was only during the third quarter of 2023 that the economy recorded positive growth after six successive quarters of negative growth experience­d by the cash-strapped economy.

The headline inflation, as measured by the year-onyear change in the Colombo Consumer Price Index, had decelerate­d to 5.9 per cent in February from 6.4 per cent in January.

The gross official reserves improved to $4.5 billion by the end of February 2024, which includes the swap facility from the People’s Bank of China.

Governor Nandalal Weerasingh­e said the reserve buildup was better than the Central Bank’s expectatio­ns.

“The reserve buildup was supported by considerab­le net purchases by the Central Bank from the domestic foreign exchange market amidst increased foreign currency inflows compared to outflows,” Weerasingh­e said.

“The Sri Lankan rupee, which appreciate­d by 12.1 per cent against the US dollar in 2023, continued to show an appreciati­on of 6.7 per cent thus far in 2024,” he said.

Weerasingh­e said the agreements on debt restructur­ing with sovereign bond-holders could be completed by June in time for the next review of the IMF bailout programme.

Weerasingh­e said despite the sovereign default, the commercial loans granted by India along with currency swaps with the Reserve Bank of India continue to be serviced.

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