Sri Lanka’s Central Bank responds to reports of ‘money printing’

The Central Bank of Sri Lanka (CBSL) today rejected as ‘completely baseless’ the recent reports claiming that the CBSL has printed currency notes to the value of Rs. 100 billion through Sri Lanka’s open market operations.

Issuing a clarification in this regard, the CBSL explained that providing liquidity through open market operations is among the general affairs carried out by the Central Bank.

Further, the CBSL clarified that the open market operations are conducted to maintain price stability through managing the interest rate, and that this measure cannot be classified as mere money printing.

Additionally, the statement highlighted that the said reports have been published regarding the auctions and monetary operations carried out by the Central Bank of Sri Lanka in the general open market activities. 

As a result, there has been no printing of new currency notes or improper issuance of money to finance the government’s budget, and what has happened is only a usual process to achieve the goals of price stability of the Central Bank, it added.