Sri Lanka cost of living to rise by 5-pct levels in second half of 2025
- 5opn1
- January 20, 2025
- News
- Sri Lanka cost of living to rise by 5-pct levels in second half of 2025
- 0 Comments
Sri Lanka’s cost of living will rise to the 5 to 7 percent target, in the second half of 2025, the central bank has said, ending falling price it has achieved under broadly deflationary monetary policy since the second half of 2022.
Amid deflationary policy the central bank allowed the exchange rate to appreciate, bringing down prices absolutely, which is not usual under International Monetary Fund programs.
In the ‘age of inflation’ involving the invention of indiscriminate open market operations and currency debasement, deflation is rarely seen, but Sri Lanka’s central bank allowed the exchange rate to appreciate in the current program amid deflationary policy.
The central bank however claimed that the deflation was due to ‘supply side’ factors. “The deflationary environment resulting from the one-off effects of supply-side price adjustments will continue in early 2025 as per the current projections of the Central Bank,”
