A warning by the Governor of the Central bank

Colombo (News1st) - Central Bank Governor Dr. Indrajith Commaraswamy commenting on the exchange rate states that the Central bank would not tolerate speculation by any party and warned that the Central bank is ready to take punitive action if necessary. Addressing an event in Colombo on Monday (June 11th) the Central Bank Governor noted that they are attempting to provide a competitive exchange rate. He noted that foreign reserves are at a historically high level adding that there is no reason for undue pressure on the exchange rate and that there is no reason for the decrease in the value of the Rupee. According to Dr Commaraswamy, this could mean that individuals or parties are speculating about the exchange rate and the Governor warned that the Central Bank would not tolerate this. He called upon the general public to look at the actions taken by Former Central bank Governor A.S. Jaywardene in 2001 to discipline the market. Dr. Commaraswamy noted that the Central Bank has all the instruments necessary to restrict banks, importers and exporters but noted that he does not want to do it. However, the CBSL Governor did warn that he is ready to take against persons who speculate and in turn impose an undue burden on the public.