During the first two months of ****, textile exports increased by *.* per cent to $**.* million. Over the same period, exports of other manufactured textile articles increased by *.* per cent to $**.* million, as per the Central Bank’s publication ‘External Sector Performance – February ****’.

Combined exports of textiles, garments, and other manufactured textile articles accounted for **.** per cent of all industrial exports from Sri Lanka during the first two months of this year. Total textile product exports amounted to $***.* million between January-February ****, while the country’s overall industrial exports were valued at $*,***.* million over the same period. This underscores the continued dominance of the apparel sector in Sri Lanka’s industrial export base, despite ongoing global demand volatility.

Consequently, the standing deposit facility (SDF) rate remains at 5 per cent and the marginal standing facility (MSF) rate and the bank rate remain at 5.5 per cent.

India’s central bank has decided to keep the repo rate under the liquidity adjustment facility unchanged at 5.25 per cent.
Elevated energy and other commodity prices coupled with supply shock due to disruptions in the Strait of Hormuz would act as a drag on FY27 domestic production.
India’s FY27 real GDP growth is projected at 6.9 per cent, while CPI inflation for the fiscal is projected at 4.6 per cent.

The committee, which held its 60th meeting from April 6 to 8 under the chairmanship of RBI governor Sanjay Malhotra, also decided to continue with the neutral stance, the monetary policy statement released after the meeting said.

Elevated energy and other commodity prices coupled with supply shock due to disruptions in the Strait of Hormuz would act as a drag on domestic production in fiscal 2026-27 (FY27), the statement noted.

Heightened volatility in global financial markets with its spillover on domestic financial conditions would weigh on growth prospects, it said.

Merchandise exports may be adversely affected from disruptions to key shipping routes and the concomitant rise in freight and insurance costs in case the conflict is long-drawn, it added.

India’s FY27 real gross domestic product (GDP) growth is projected at 6.9 per cent, with the first quarter (Q1) at 6.8 per cent; Q2 at 6.7 per cent; Q3 at 7 per cent; and Q4 at 7.2 per cent.

Further escalation of the conflict, its continuation over a wider geographical spread and uncertainty regarding the damage to the energy infrastructure, apart from weather related events, pose downside risks to the domestic growth outlook.

Consumer price index (CPI)-based inflation for FY27 is projected at 4.6 per cent, with Q1 at 4 per cent; Q2 at 4.4 per cent; Q3 at 5.2 per cent; and Q4 at 4.7 per cent. Persistently elevated energy prices due to the Middle East conflict and possible El Nino conditions pose upside risks to inflation.

Core inflation is projected at 4.4 per cent for FY27 and, excluding precious metals, it is even lower, indicating that underlying inflation pressures are expected to remain contained, the statement observed.

With the rupee depreciating, RBI would then work to keep inflation within its target range of 2-6 per cent.

Fibre2Fashion News Desk (DS)