Sri Lanka’s CPC in shocking Rs628bn loss on soft-pegging loans

Sri Lanka’s state-run Ceylon Petroleum Corporation has lost 628 billion rupees in the first four months of 2022, driven by un-hedged dollar loans it was forced to take whenever the central bank printed money to create forex shortages.

It now had a negative net worth of over a trillion rupees.

The CPC had borrowed over 3 billion dollars from two state banks after importing oil on credit without buying dollars in the market whenever the central bank printed money to manipulate rates and created forex shortages and currency crises in the course of operating a flexible inflation targeting regime.

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