• Thu. Apr 25th, 2024

Sri Lanka’s economy contracted by 3.9% in 2020- Central Bank

The Central Bank (CB) expects Sri Lanka’s economy to have contracted by 3.9 percent in 2020 well below its earlier projections.

“The marginal decline in the first, and the relatively large decline in the second quarter of 2020 were followed by marginally positive growth in the third quarter. With observed developments in the fourth quarter, we expect the economy to record an annual contraction of around 3.9 percent,” CB Governor, W D Lakshman said today.

The CB was projecting a positive or natural economic growth for 2020 before the outbreak of the second wave of Covid-19 in the country.

The Governor outlined that both monetary and fiscal interventions are essential to provide adequate impetus to the economy amidst the challenging domestic and global macroeconomic conditions

” The Central Bank will continue the prevailing accommodative monetary policy stance in 2021 to ensure the envisaged recovery of economic activity. We would of course, be closely monitoring developments to avoid any strong demand-driven pressures on inflationary trends,” he said.

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