Local Economy News:

Sri Lanka’s 3-month and 12-month treasury bill yields increased by 1bp each to 5.22% and 5.25% respectively. Meanwhile, 6-month treasury bills were not accepted during the week.

https://www.cbsl.gov.lk/sites/default/files/cbslweb_documents/press/pr/press_20210719_treasury_bill_auctions_held_on_19_july_2021_e.pdf

 

Global News:

Oil producing nations agree deal to control prices (Daily Mirror)

Oil-producing nations have agreed to increase their output, reduce prices and ease pressure on the world economy. The OPEC cartel and partners such as Russia will boost supply from August 2021E after prices climbed to two-and-half-year highs during the pandemic. The move should have an impact on petrol prices at the pump. In 2020 OPEC and its partners cut production by a record 10mn barrels per day amid a pandemic-induced slump in demand and collapsing prices. Under the new deal, OPEC and partners have agreed to increase supply by a further 2mn barrels per day from August – 2021E until December 2021 to help stabilize the market.

https://www.dailymirror.lk/business-news/Oil-producing-nations-agree-deal-to-control-prices/273-216501

 

Local News:

Sri Lanka disputes Moody’s downgrade warning (Economy Next)

The Government of Sri Lanka (GOSL) stated that it was surprised over the announcement by Moody’s Investors Service on Sri Lanka Caa1 sovereign on downgrade review, GOSL has diligently lined up adequate funds to repay its maturing foreign debt liabilities, including the International Sovereign Bond (ISB) maturing at end July 2021. Finance Ministry stated that, Moody’s action could create uncertainty among investors who have kept faith in Sri Lankan ISBs and other investments. It was further stated GOSL has taken all measures to repay the upcoming ISB maturity of US$1bn due at the end of July 2021.

https://economynext.com/sri-lanka-disputes-moodys-downgrade-warning-84150/

 

Sri Lanka exports up 9.4% in June 2021 (Economy Next)

As per Sri Lanka’s custom data, exports grew 9.4% YoY to US$978mn as the sector battled the third wave of Coronavirus, falling a little short of 2019, with the US, UK, and India being top buyers. In the 6 months to June, exports were up 27% to ~US$5.6bn.

https://economynext.com/sri-lanka-exports-up-9-4-pct-in-june-2021-84152/

 

Sri Lanka Tourism requests CBSL to write off debt or interest to help industry (Daily FT)

With the third wave of the COVID pandemic, tourism authorities have requested new relief from the CBSL in addition to the extended debt moratorium from banks and finance companies and the concessionary working capital arranged for the industry during 2020/2021. Accordingly, Sri Lanka Tourism has requested the Central Bank to write off outstanding debts or waive interest to sustain stakeholders who would otherwise be forced to shut down operations in the absence of tourists.

https://www.ft.lk/front-page/Sri-Lanka-Tourism-requests-CB-to-write-off-debt-or-interest-to-help-industry/44-720676

 

Results for the period ended 30 June 2021:

Tea Smallholder Factories (TSML) reported a 1Q22 net profit of Rs.0.5mn (-99% YoY).