IMF Loan Design Will Lower Market Rates as Fiscal Support

Bloomberg:  Sri Lanka’s bailout by the International Monetary Fund will help the bankrupt nation lower its borrowing costs, thanks in part to a change in how the cash can be used, central bank Governor Nandalal Weerasinghe said, reported Bloomber. He had also noted that the IMF loan design will lower market rates as Fiscal Support.

The Washington-based lender for the first time will allow Sri Lanka to use funds from the $3 billion bailout to cover government spending, Weerasinghe said in an interview late Tuesday in the capital Colombo.

The South Asian country’s 16 previous bailouts only targeted balance-of-payment support.