• Colombo Biz Assoc. says prices cannot be revised quickly due to supply chain issues
• Prices of essential items to be reduced by first week of April
• Association predicts USD to reach Rs. 300 in coming days

The market will see the impact on non-essential goods from the recent appreciation of the rupee (LKR) in two or three months due to the delays in supply chains, Colombo Business Association (CBA) said.

Speaking to the media yesterday (13), the General Secretary of CBA Chaminda Vidanagamage said although there has been an appreciation of the rupee in recent weeks, the wholesale prices of goods cannot be changed within a day due to the supply chain connected.

“The effects of the rupee appreciation will take two to three months to be seen in the market except for essential food items which will take three weeks,” he added.

Moreover, he said that importers have started to import more with the recent rupee appreciation targeting the upcoming festive season, and added that the Central Bank Governor has promised the importers enough foreign exchange to facilitate the imports targeting the festive season.

He noted that the price of essential items will be reduced by the first week of April with the rupee appreciation.

Vidanagamage said that the CBA expects the dollar to reach close to the Rs. 300-level in the coming weeks.

As of yesterday, a US dollar was sold at Rs. 330 by the Bank of Ceylon (BOC), Rs. 331.47 by People’s Bank, and Rs. 327 by Hatton National Bank. 

Further, Vidanagamaga said that the Government needs to implement laws to curb the foreign exchange black market in order to attract more remittances to the banking system.

“If we can curb the Undiyal/Hawala, then monthly remittances to the banking sector will increase to $ 900-1,000 million, but still we haven't been able to pass the $ 300-400 million mark because of this black market,” he said.

He also said that proposals presented by the business community to the Government on providing discounts on goods, essential items, apparel and medicine for families receiving monthly remittances, with the intention of attracting foreign exchange to the banks were not implemented by the government officials.