Economic Recovery

Sri Lanka's recent economic performance has been strong, but the recovery remains incomplete, the World Bank said on Tuesday. "With growth still below pre-crisis levels and poverty significantly elevated, strengthening the recovery will require continued macroeconomic stability, urgent structural reforms, and more efficient, better-targeted public spending, it said. Sri Lanka's economy crashed in 2022 due to a forex crisis stemming from the COVID-19 pandemic and other flawed political and economic management reasons since 2019. The current turnaround was aided by the four-year IMF bailout of nearly 3 billion USD pinned to a stringent reform regime. While Sri Lanka's recent economic progress is encouraging, the recovery is uneven and incomplete, said David Sislen, World Bank Division Director for Maldives, Nepal, and Sri Lanka. The World Bank projects Sri Lanka's economy to grow by 4.6 per cent in 2025 supported by a modest rebound in industry and steady growth in services before

India has a role to play in its economic recovery

The Central Bank of Sri Lanka (CBSL) cut the Standing Deposit Facility Rate to 8.25 per cent and the Standing Lending Facility Rate to 9.25 per cent

Governor Shaktikanta Das on Friday said the Reserve Bank's relations with the government have been "smooth" during his nearly six-year term, and credited the close coordination between the two for the quick revival of the economy after the pandemic. Speaking at an event organised by Financial Express here, the bureaucrat-turned-central banker said nobody has expected him to be a "cheerleader" for the government during his term. "I am saying from my experience. Nobody expects RBI to be a cheerleader. I have had no such experience," he said, responding to a specific question about a lament made by one of his predecessors in a recent book. Asked if he is open for a new term at Mint Road, Das said he is very focused on the current assignment and does not think of anything outside that. Das said the RBI is optimistic that its estimate of 7.2 per cent growth for FY25 will be met, and added that with steady growth, the focus of the policy has to be "clearly and unambiguously" on inflation

Just like the post-pandemic recovery, the Indian inflation story is also 'K-shaped' and is hurting certain sections more than others, a foreign brokerage said on Tuesday. Rural consumers are more impacted by price-rise than their urban counterparts, economists at HSBC said, adding it outstripped the urban segment by 1.1 percentage point in May, mainly due to higher food inflation. "The same developments, driving a K-shaped recovery, seem to be driving K-shaped inflation dynamics," they said in a report. The report by its chief economist Pranjul Bhandari cited the ongoing heat waves, pointing out that higher food and lower core inflation are coexisting because of crop damage and livestock mortality pushing up the former. The government lent a helping hand by cutting several fuel prices but many of the fuels like petrol, diesel and LPG are not commonly used in rural areas, like they are in urban centres, leading to rural inflation being much higher than urban, it said. The report no

The key to Sri Lanka's transition from stabilisation to full economic recovery is sustaining the ongoing reform momentum, the IMF said on Friday after it decided to release the third tranche of USD 336 million from the USD 2.9 billion four year bailout package to the island nation. While releasing the third tranche, the IMF on Thursday noted that Sri Lanka's economy has started recovering, inflation remained low, revenue collection was improving, and reserves continued to accumulate but warned that despite these positive developments, the economy is still vulnerable and the path to debt sustainability remains knife-edged. We encourage the (Sri Lankan) authorities to continue to build on these hard-won gains and remain steadfast with their reform commitments, Peter Breuer, the head of the Sri Lanka IMF mission, told reporters here on Friday. In April 2022, Sri Lanka declared its first-ever sovereign default since gaining Independence from Britain in 1948. The unprecedented financial

The International Monetary Fund in March this year approved a 48-month, $2.9 billion extended arrangement under the Extended Fund Facility (EFF) to support Sri Lanka's economic policies and reforms

The factory gauge offers encouragement to Chinese policymakers who are relying on the country's industrial producers to offset weak domestic demand

RBI's adept role in India's recovery deserves greater recognition

Alibaba is under pressure as consumers in China, have been cutting spending, boosting rival lower-cost domestic e-commerce players such as PDD Holdings

The official manufacturing purchasing managers index fell to 49.4, the second straight month of contraction, according to a Thursday statement from the National Bureau of Statistics

Thailand PM Srettha said he plans to make a trip to India this year to meet his counterpart Narendra Modi and discuss increasing flight frequency between the two countries

The upbeat data suggest that a flurry of recent measures including property support policies to shore up a faltering economic recovery are starting to bear fruit

Excise duty mop-up falls 15%

RBI's pause in interest rate hikes and a continuation of the revival of private consumption would boost NBFCs in the first quarter (Q1) FY24

The FY24 Budget has projected a corporation tax mop-up of Rs 9.23 trillion, up 10.5 per cent from Rs 8.35 trillion in 2022-23 (Revised Estimates)

Domestic travel spending during the recent holiday for the dragon-boat festival was lower than pre-pandemic levels, according to official data released this weekend

China lowered its one-year and five-year loan prime rates (LPR) by 10 basis points, the first such easing in 10 months as authorities seek to shore up a slowing economic recovery

The economy expanded by 4.5% year-on-year in the first three months of the year, beating market expectations and marking the strongest growth in a year but its resilience looks likely to be tested

However, the improvement will not be uniform; stronger firms will likely gain market share, weaker ones may resort to originate-and-distribute business models to tide over liquidity stress