Govt. has printed Rs. 213 billion since March: CBSL

The cash strapped Sri Lankan government has printed a staggering Rs. 213 billion since the first week of March this year, the Central Bank of Sri Lanka (CBSL) announced.

CBSL revealed that Rs. 7.8 billion was printed on this week alone. As such, CBSL holdings of government securities which stood at Rs. 78.01 billion as of the 12th of March this year, now stands at Rs. 291.83 billion as of Friday, the 24th of April.

Fitch downgrades Sri Lanka

Meanwhile, Fitch Ratings downgraded Sri Lanka to 'B-' with a negative outlook, as the country cut value added tax in January and printed large volumes of money to target the call money rate, pressuring the currency amid a pandemic.

"The shock to Sri Lanka's economy from the coronavirus pandemic will exacerbate already-rising public and external debt sustainability challenges following tax cuts  and an associated shift in fiscal policy late last year," Fitch Ratings said.

"The pandemic will especially hurt the tourism sector, which, combined with weaker domestic demand, will further damage Sri Lanka's public and external finance metrics", the ratings agency said.