SRI LANKA, Jan. 13 -- The Central Bank maintains its monetary policy in an increasingly forward looking manner to maintain inflation at low and stable levels in the medium-term, thereby supporting the economy to reach its potential. The recent rupee depreciation is aligned with capital outflows, not the current account, Central Bank Governor Dr. Indrajit Coomaraswamy said.
"Although we do not consider the Exchange rate as an objective of monetary policy conduct, a market-based Exchange rate remains a key instrument to facilitate the inflation targeting framework. The Central Bank will continue to follow a more market-based Exchange rate system, allowing the Exchange rate to act as the shock absorber in the envisaged FIT (Flexible Inflation...