Abstract:
This research critically examines the transformation of the Central Bank of Sri Lanka (CBSL)
and its profound impact on the nation’s economic stability and growth. As a result of the
Central Bank of Sri Lanka Act No. 16 of 2023, the CBSL has undergone a paradigm shift
concerning its objectives, roles, and functions. The new mandate introduced through these
provisions, including lucrative and developed provisions, has opened avenues for inclusive
considerations of the monetary policy of Sri Lanka, the stability of the economic growth, the
sustainability of state and non-state financing sectors, and the inflation control aspects at both
macro and micro levels. In this context, this research delves deep into the implications of these
changes, shedding light on the new emphasis on price stability within an inflation-targeting
framework. This research further explores how the CBSL effectively manages the payment
system, undertakes agency functions such as public debt management, and acts as the custodian
of the Employees Provident Fund. It highlights the pivotal functions of the CBSL, including the
formulation and implementation of monetary policy, currency issuance, and the maintenance
of financial stability. Moreover, it explores CBSL’s crucial role as the lender of last resort
during financial crises and its active involvement in the regulation and supervision of banks
and financial institutions. The research also sheds light on the CBSL’s role in managing...
