CB Governor says biggest bugbear for businesses is high inflation

By Shyam Nuwan Ganewatta

The main problem troubling businesses is not high interest rates but high inflation, Governor of the Central Bank, Dr. Nandalal Weerasinghe, says.

“The prices of all inputs are high. The cost of labour is high. The cost of transport as well as energy is high. The price of everything is high because of high inflation,” he said.

The CBSL Governor said that the cost of finance was less than 10 percent of the manufacturing process.

“We have managed to bring inflation under control through high interest rates. The inflation has stabilised and now it’s dropping slowly. When the inflation is down, we can ease the interest rates. If we had not increased rates, there would have been hyperinflation and everything would have collapsed,” he said.