Q2-2019 GDP growth slows to a five-year low
The Ceylon Chamber publishes Sri Lanka Economic Acceleration Framework 2020-25
OECD cuts growth outlook to decade low; Oil prices volatile after attack on Saudi production facilities
Growth Slows to 1.6% in Q2-2019: Sri Lanka’s GDP expanded by 1.6% during Q2- 2019, While this is the lowest quarterly growth recorded since 2014, it was mainly driven by the negative impacts of the 21st April attacks with all three major sectors growing under 2%.
CBSL Orders Banks to Reduce Interest Rates by 2%: The CBSL recently ordered all licensed banks to slash interest rates by at least 2% by 15 October 2019, to offset a steep slowdown in private sector credit and growth of non- performing loans.
Ceylon Chamber Launches 2020-25 Economic Acceleration Framework: The Ceylon Chamber of Commerce launched a working draft of its 2020-25 Sri Lanka Economic Acceleration Framework, which focused on re-calibrating Sri Lanka’s economic trajectory. It is now available at www.seaf.chamber.lk and open for feedback from the public.
Recovery in Tourism Arrivals post 21st April Attacks: In August 2019 tourist arrivals reached 143,587 arrivals, a significant rise compared to the preceding three months following the 21st April attacks. Arrivals for the first eight months of 2019 fell by 20% compared to 2018.
LKR depreciates since August 2019: The LKR (spot) against the USD has depreciated by 2.9% since the start of August owing to outflows in the government securities market and global volatility. Despite the recent depreciation, the LKR has appreciated close to 1% for the year so far.
OECD Cuts Growth Outlook to Post-Crisis Low: OECD slashed its growth forecasts owing the trade war between the US and China. OEDC expects the global economy to grow at 2.9%, the slowest since the 2008-2009 financial crisis.
Oil Prices Volatile after Attacks on Saudi Facilities: The week following the attack on the Saudi production facilities saw a 6.7% jump in Brent oil prices, its largest weekly rise since January 2019. Concerns over energy demand since then has seen a recovery in prices.
US Fed Cut Interest Rates Again: The Fed cut its interest rates for the second time in 2019 as it looks to stimulate the US economy and get inflation closer to the Fed’s target of 2%.
Global Services Trade Expected to Weaken in 2H-2019: World trade in commercial services lost momentum through the Q2-2019 and is expected to weaken further into the second half of 2019 according to the World Trade Organisation (WTO).