CBSL will keep policy rates on hold owing to concerns about external stability: Standard Chartered

Quotes from Standard Chartered:

-We maintain our view that the CBSL will keep policy rates on hold owing to concerns about external stability, despite lower domestic inflation.

-Lower yields in mid-2014 resulted in heavy FII outflows of c.USD 410mn from the local GSec market, and the Sri Lankan rupee (LKR) has depreciated 1.4% so far this year.

-This is particularly negative, given the country's external debt redemptions of USD 3.5bn due in 2015 and its high debt-to-GDP ratio of 75% as of December 2014.