Sri Lanka’s CCPI inflation falls 1.7% in Dec. ’24

Sri Lanka’s consumer price index (CCPI) inflation fell by 1.7 per cent year-on-year in December, following a 2.1 per cent drop in November, as reported by the Department of Census and Statistics on Tuesday.

The decline in inflation was supported by reductions in power tariffs, fuel prices, and an appreciating rupee. Food prices increased slightly by 0.8 per cent, while non-food prices dropped by 3 per cent.

The annual average inflation for 2024 ended at 1.2 per cent, a significant recovery from the 17.4 per cent inflation rate a year earlier. Analysts predict that inflation will remain negative in January before returning to positive territory over the next few months.

Sri Lanka’s economy, which faced record inflation following a severe financial crisis, has stabilised since securing a $2.9 billion bailout from the International Monetary Fund (IMF) in March 2023.

The country’s central bank recently lowered its policy rate to 8 ,per cent aiming to support economic recovery. Sri Lanka’s economy is expected to grow by 4.5 -5 per cent in 2024, slightly surpassing the World Bank’s forecast of 4.4 per cent.

Attribution: Amwal Al Ghad English & Reuters

Subediting: Y.Yasser