AGL 40.10 Increased By ▲ 0.10 (0.25%)
AIRLINK 131.00 Increased By ▲ 1.47 (1.13%)
BOP 6.84 Increased By ▲ 0.16 (2.4%)
CNERGY 4.71 Increased By ▲ 0.08 (1.73%)
DCL 8.99 Increased By ▲ 0.05 (0.56%)
DFML 42.75 Increased By ▲ 1.06 (2.54%)
DGKC 84.30 Increased By ▲ 0.53 (0.63%)
FCCL 33.05 Increased By ▲ 0.28 (0.85%)
FFBL 76.70 Increased By ▲ 1.23 (1.63%)
FFL 11.56 Increased By ▲ 0.09 (0.78%)
HUBC 111.00 Increased By ▲ 0.45 (0.41%)
HUMNL 14.70 Increased By ▲ 0.14 (0.96%)
KEL 5.46 Increased By ▲ 0.07 (1.3%)
KOSM 8.51 Increased By ▲ 0.11 (1.31%)
MLCF 39.80 Increased By ▲ 0.01 (0.03%)
NBP 60.90 Increased By ▲ 0.61 (1.01%)
OGDC 198.25 Decreased By ▼ -1.41 (-0.71%)
PAEL 26.80 Increased By ▲ 0.15 (0.56%)
PIBTL 7.94 Increased By ▲ 0.28 (3.66%)
PPL 158.32 Increased By ▲ 0.40 (0.25%)
PRL 26.64 Decreased By ▼ -0.09 (-0.34%)
PTC 18.65 Increased By ▲ 0.19 (1.03%)
SEARL 82.40 Decreased By ▼ -0.04 (-0.05%)
TELE 8.33 Increased By ▲ 0.02 (0.24%)
TOMCL 34.46 Decreased By ▼ -0.05 (-0.14%)
TPLP 9.25 Increased By ▲ 0.19 (2.1%)
TREET 17.40 Decreased By ▼ -0.07 (-0.4%)
TRG 61.70 Increased By ▲ 0.38 (0.62%)
UNITY 27.75 Increased By ▲ 0.32 (1.17%)
WTL 1.37 Decreased By ▼ -0.01 (-0.72%)
BR100 10,500 Increased By 93.7 (0.9%)
BR30 31,876 Increased By 162.7 (0.51%)
KSE100 97,996 Increased By 667.7 (0.69%)
KSE30 30,390 Increased By 197.1 (0.65%)

COLOMBO: Sri Lanka’s inflation is expected to return to the government’s 5% target starting from the last two quarters of the year, a Central Bank of Sri Lanka (CBSL) official said on Wednesday, as the economy stabilises from a crippling financial crisis.

The economy has shown signs of recovery in recent months, aided by a $2.9 billion International Monetary Fund (IMF) programme, after it went into freefall in 2022 due to a severe foreign exchange shortage.

Sri Lanka shares end higher

“Inflation is projected to reach 5% in the medium term, which is from about the third quarter to the end of the year,” S. Jegajeevan, the director of CBSL’s economic research department, told reporters.

“The high base effect from the tax increases is expected to benefit inflation in early 2025 and possibly even bring it lower than 5%.”

The South Asian country defaulted on its overseas debt in May 2022 after depleted foreign exchange reserves triggered worst financial crisis since independence from Britain in 1948.

At the start of 2024, Sri Lanka raised its value added tax (VAT) to 18% from 15% to meet revenue targets under the IMF programme, sparking an uptick in its key inflation rate, which rose to 6.4% at the end of January from 4% the month before.

Sri Lankan health crisis could worsen as doctors seek work abroad

The CBSL, which committed to maintaining inflation at 5% under a new act introduced last year, said price increases from the tax hike were unlikely to persist due to subdued demand and the economy operating below its full capacity.

Comments

Comments are closed.