ECONOMYENXT - Sri Lanka has no reason to tighten monetary policy right now, though bank credit growth is strong, Central Bank Governor Arjuna Mahendran said.
"Right now there is no real reason to tighten monetary policy," Mahendran told a business forum organized by HSBC in Colombo.
He said bank credit has been strong but on a monthly basis credit it has not been high.
Mahendran said inflation would hopefully be under control because there are several measures in the budget to strengthen the 'supply side' and there was also a benign international situation.
Sri Lanka was a small trading country in the world and the international picture had to be taken into account and India has been cutting rates.
He said there was no credit bubble as some sections of the media has been saying.
"Right now there is no real reason to tighten monetary policy," Mahendran told a business forum organized by HSBC in Colombo.
He said bank credit has been strong but on a monthly basis credit it has not been high.
Mahendran said inflation would hopefully be under control because there are several measures in the budget to strengthen the 'supply side' and there was also a benign international situation.
Sri Lanka was a small trading country in the world and the international picture had to be taken into account and India has been cutting rates.
He said there was no credit bubble as some sections of the media has been saying.
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