Business

Rs. 104 billion printed in two weeks

  • PM wants Rs. 1 tn to cover Govt. expenditure
  • Rs. 85 bn printed on 20 May alone 

 

By Imesh Ranasinghe

The Central Bank of Sri Lanka (CBSL) has printed Rs. 104 billion within the two-week period of 11-24  May, as Prime Minister Ranil Wickremesinghe wants to print Rs. 1 trillion to cover Government expenditure.

In an interview with Reuters on Tuesday (24), Prime Minister Wickremesinghe, who was also appointed Minister of Finance, Economic Stability, and National Policies, said that the Government needs to print Rs. 1 trillion, as it has no rupee revenue, adding that inflation could surpass 40% in the coming months.

Earlier, CBSL Governor Dr. Nandalal Weerasinghe said that unless there is a tax hike by the Government, it would have to print money to provide for government expenses, regardless of expenditure cuts.

The CBSL on 20 May printed Rs. 85.3 billion, a record amount of money printed in a day since Dr. Weerasinghe took office, taking the total amount of money printed during Dr. Weerasinghe’s tenure to Rs. 124.4 billion, with a daily average of Rs. 4.78 billion. 

So far, the CBSL has printed Rs. 572 billion in 2022; in 2021, it printed Rs. 1.2 trillion worth of money, and Rs. 650 billion in 2020.

On Monday (23), inflation rose to a record 33.8% year-on-year (YoY) in April, compared to 21.5% in March.

Wickremesinghe also told Reuters that an interim Budget would be presented in six weeks’ time, where “with the interim budget, it is just about cutting down expenditure, cutting to the bone where possible, and transferring it to welfare”.

To find the money for supporting relief measures, the Prime Minister said his administration was undertaking a review of possible expenditure cuts across the country’s bloated government sector.

“For instance, in the Ministry of Health, we just can’t cut down its expenditure. In the Ministry of Education, it’s a limited cut-down; but there are many other ministries where we can cut,” he said.