Tea, rubber production decreased, coconut production increased

During the first five months of 2022, tea production decreased in comparison to the corresponding period of the previous year due to the unavailability of required fertilisers. Rubber production also decreased due to the combined effect of the spread of fungal disease and fertiliser shortages. However, coconut production increased considerably due to the lagged effect of favourable weather conditions that prevailed since the latter part of 2020 and throughout 2021.

During the period under review (02.07.2022 to 08.07.2022), crude oil prices showed mixed performance. At the beginning of the period, prices declined sharply on growing fears of the impact of a global recession and lockdowns in China. However, prices somewhat recovered towards the end of the week with heightened concerns over tight supply. Overall, during the period under review, Brent price decreased by US dollars 6.23 while WTI prices decreased by US dollars 5.06 per barrel.

On 07th July 2022, the Central Bank increased its Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) by 100 bps each, to 14.50 per cent and 15.50 per cent, respectively. The Bank Rate, which is linked to the SLFR with a margin of +300 bps, automatically adjusted to 18.50 per cent.

Weekly AWPR for the week ending 08th July 2022 decreased by 35 bps to 22.27 per cent compared to the previous week. The reserve money increased compared to the previous week mainly due to the deposits held by the commercial banks with the Central Bank.

The total outstanding market liquidity was a deficit of Rs. 630.701 bn by the end of this week, compared to a deficit of Rs. 648.335 bn by the end of last week.

By 08th July 2022, the All Share Price Index (ASPI) decreased by 5.05 per cent to 7,080.69 points and the S&P SL 20 Index decreased by 5.69 per cent to 2,244.83 points, compared to the index values of last week.

During the four months ending April 2022, government revenue increased to Rs. 630.9 bn compared to Rs. 481.7 bn recorded in the corresponding period of 2021.

During the period from January to April 2022, total expenditure and net lending increased to Rs. 1,155.2 bn compared to Rs. 1,002.8 bn recorded in the corresponding period of 2021.

During the four months ending April 2022, overall budget deficit increased to Rs. 524.1 bn compared to Rs. 520.5 bn recorded in the corresponding period of 2021.

During the four months ending April 2022, domestic financing increased to Rs. 651.1 bn compared to Rs. 503.5 bn in the corresponding period of 2021. Foreign financing recorded a net repayment of Rs. 127.0 bn during the period from January to April 2022, compared to a net borrowing of Rs. 17.0 bn recorded in the corresponding period of 2021.

Outstanding central government debt increased to Rs. 23,310.1 bn by end April 2022 from Rs. 17,589.4 bn as at end 2021. By end April 2022, total outstanding domestic debt amounted to Rs. 12,442.3 bn while the rupee value of total outstanding foreign debt amounted to Rs. 10,867.8 bn.

During the year up to 08th July 2022, the Sri Lankan rupee depreciated against the US dollar by 44.4 per cent. Given the cross currency exchange rate movements, the Sri Lankan rupee depreciated against the Indian rupee by 40.8 per cent, the Euro by 38.1 per cent, the pound sterling by 37.6 per cent and the Japanese yen by 34.3 per cent during this period.

The gross official reserves were provisionally estimated at US dollars 1,859 mn as at end June 2022.

-CBSL