25 Sep 2023 | BY Imesh Ranasinghe
Bank lending rates fell below 15% for the first time after 17 months as the Average Weighted Prime Lending Rate (AWPLR) fell to 14.81% at the end of the last week, Central Bank of Sri Lanka (CBSL) data showed.
According to the weekly indicators by the CBSL, the weekly AWPLR for the week ending 22 September decreased by 40 basis points to 14.81% compared to the previous week.
Speaking to The Daily Morning Business, First Capital Chief Research and Strategy Officer Dimantha Mathew said that they are expecting the AWPLR to stay between the range of 10-15% by the end of 2023, broadly in line with the Treasury Bond rates.
At the Treasury Bond auction held yesterday (25), the three-year (2026) bond recorded a Weighted Average Yield Rate of 15.64% while the five-year (2028) bond went to 14.52%.
Matthew also noted that they expect a further policy rate cut by 200 basis points in the next two Monetary Policy Reviews by the CBSL, where the Standing Deposit Facility Rate (SDFR) and Standing Lending Facility Rate (SLFR) were to reach 9% and 10% by the end of the year, respectively.
In a webinar last month, Capital Alliance Ltd. Head of Research Trisha Peries said that they forecast the AWPLR to reach 14.5% by the end of October this year and then reach 13.5% by the end of 2023 with further policy rate cut of 200-250 basis points.
Since June, CBSL has reduced the policy rates by 450 basis points as inflation came down much faster than expected with the National Consumer Price Index falling to 2.1% in August from 53.2% in January.
In the last Monetary Policy Review, the CBSL issued directions on maximum lending rates where pawning facilities should reach 18% per annum, pre-arranged temporary overdrafts at 23%, and credit cards at 28%.
- https://www.themorning.lk/articles/7LuyQDleirAMrmhkI2mu
Bank lending rates fell below 15% for the first time after 17 months as the Average Weighted Prime Lending Rate (AWPLR) fell to 14.81% at the end of the last week, Central Bank of Sri Lanka (CBSL) data showed.
According to the weekly indicators by the CBSL, the weekly AWPLR for the week ending 22 September decreased by 40 basis points to 14.81% compared to the previous week.
Speaking to The Daily Morning Business, First Capital Chief Research and Strategy Officer Dimantha Mathew said that they are expecting the AWPLR to stay between the range of 10-15% by the end of 2023, broadly in line with the Treasury Bond rates.
At the Treasury Bond auction held yesterday (25), the three-year (2026) bond recorded a Weighted Average Yield Rate of 15.64% while the five-year (2028) bond went to 14.52%.
Matthew also noted that they expect a further policy rate cut by 200 basis points in the next two Monetary Policy Reviews by the CBSL, where the Standing Deposit Facility Rate (SDFR) and Standing Lending Facility Rate (SLFR) were to reach 9% and 10% by the end of the year, respectively.
In a webinar last month, Capital Alliance Ltd. Head of Research Trisha Peries said that they forecast the AWPLR to reach 14.5% by the end of October this year and then reach 13.5% by the end of 2023 with further policy rate cut of 200-250 basis points.
Since June, CBSL has reduced the policy rates by 450 basis points as inflation came down much faster than expected with the National Consumer Price Index falling to 2.1% in August from 53.2% in January.
In the last Monetary Policy Review, the CBSL issued directions on maximum lending rates where pawning facilities should reach 18% per annum, pre-arranged temporary overdrafts at 23%, and credit cards at 28%.
- https://www.themorning.lk/articles/7LuyQDleirAMrmhkI2mu
