RADAR ON INTEREST RATES
Concerns among businesspeople shift as interest rates take second billing
Inflation continues its hold at the top of the list of burning issues in business circles while interest rates edge up, having surpassed high taxes in the latest LMD-NielsenIQ Business Confidence Index (BCI) survey.
Nearly half (49%) cited inflation as a primary concern in September, which reflects a three point decline from 52 percent in August.
According to the poll conducted in the first week of September, interest rates have overtaken high taxes with 45 out of 100 survey participants expressing concern over the cost of borrowing.
The shift in concern towards interest rates comes as the Monetary Board of the Central Bank of Sri Lanka recently decided to maintain its Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) at their current levels of 11 and 12 percent respectively.
Notably, the monetary regulator said the decision was based on an analysis of current and expected developments in the domestic and global economies.
With borrowing rates ranked second – after a lapse of five months – businesspeople cite high taxes as the third most pressing issue (36% say so, compared to nearly 60% six months ago).
On a national scale, the economy continues to plague businesspeople with 79 percent apprehensive – from 76 percent in the preceding month.
Meanwhile, in a tie for second place is the brain drain with three in 10 (34%) saying it’s a concern – i.e. a 10 point increase from August. And 34 percent state that insufficient per capita income and the cost of living are as concerning to them.
