Central Bank Governor says he changed his mind about resigning

Central Bank (CB) Governor Dr. Nandalal Weerasinghe says that he has changed his mind about resigning from the post of CB Governor as there was progress in the path towards political stability with appointment of a new Prime Minister.

Speaking at a media conference on Thursday, he said that he made a statement at a recent press conference regarding the socio political instability and his intention to resign from the post of CB Governor if the situation continues with political uncertainty. Dr Weerasinghe expressed the belief that he will be able to work more successfully under the present setup.

The CB will be using necessary tools available including injecting liquidity to stabilise interest rates which have been doubled under the current policy interest rates and to restrict imports to save much needed foreign exchange, he said.

He said they will not hesitate to use instruments at their disposal to stabilise the interest rates.

Deposit margins on letters of credit (LCs) will be introduced to curtail imports making it compulsory for non-essential commodity importers to pay money upfront and in advance to open LCs, he added.

At the Treasury bill auction on Wednesday the CB has rejected most of the bids in which the market rate increased to over 24 per cent, he said adding that this practice will be continued until the interest rates moderate. (Bandula)