Sri Lanka’s Interest Rates at ‘Appropriate’ Level, Cabraal Says

Sri Lanka’s interest rates are at an “appropriate” level, central bank Governor Ajith Nivard Cabraal said, signaling he may hold off on raising borrowing costs next week even as the economy accelerates.

Inflation is within policy makers’ targets and that may reduce the risk of interest-rate changes, Cabraal, 55, said in an interview in Singapore today. Sri Lanka’s $42 billion economy, which has been performing better than policy makers had expected, may expand as much as 8 percent in 2010 and 2011 as agriculture and tourism grow, he said.