Econsult Asia Pvt Ltd

The Econsult Asia view on the consequences of currency depreciation.

🚨 What could devaluation of the Sri Lankan rupee mean for prices? 🚨

🔍 Estimates by Econsult Asia forecast that the recent 15% devaluation of the LKR could lead to:

🍞 Bread prices going up by 30 LKR
🥛 Milk prices going up by 400 LKR
🛢️ Diesel prices going up by 75 LKR
⛽ Petrol prices going up by 100 LKR
🏠 Cement prices going up by 600 LKR
🍳 Gas prices going up by 1500 LKR
⚓ External debt going up by 1.2 trillion LKR

Currency devaluation drives up the cost of imports, leading to inflation. Devaluation also increases the cost of servicing external debt, creating a vicious cycle.

Monetary Policy choice taken is the worst prescription to a country with below par Economic recovery since 2015. Central Bank knows that the real economy is still very fragile and has significant balance sheet debt.

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CBSL’s historic rate hike double blow to economy: Econsult | Daily FT Research firm and think tank Econsult says Friday’s rate hike by the Central Bank by 100 basis points is a double blow to the economy. ..

//It’s been two years since the discovery of the first Covid-19 patient and the ensuing lockdowns which pushed the global economy into turmoil. Sri Lanka was a victim of both the health and economic crises that came with the pandemic. But for a country that has gone through 16 International Monetary Fund (IMF) programmes, the macroeconomic data for 2020 and 2021 shows that these two years were not so different from the preceding decades.//

Read more: https://www.themorning.lk/covid-19-in-sri-lanka-macroeconomic-crisis-or-more-of-the-same/

Covid-19 in Sri Lanka: Macroeconomic crisis, or more of the same? - The Morning - Sri Lanka News By Bodh Maathura It’s been two years since the discovery of the first Covid-19 patient and the ensuing lockdowns which pushed the global economy into turmoil. Sri Lanka was a victim of both the health and economic crises that came with the pandemic. But for a country that has gone[...]