Sri Lanka’s 70% inflation is nearing its peak as the shortage problem is eased.
The monetary authorities’ interest rate decisions continue to be made based on information and forecasts for the future, with the CBSL temporarily suspending rate hikes after raising overall interest rates by 9.5% this year, leaving the current rate at 15.5%, as Sri Lanka has the highest inflation in Asia.
“We think we are seeing the peak of inflation. It will be turning around and if that is lower in October, as we expect, then we can see that trend will continue,” said the Sri Lankan Central Bank governor.
The government has made some progress in restoring Sri Lanka’s $81 billion economy as more basic goods such as food and fuel become readily available. At the same time, authorities continued to restructure debt. Dealing with creditors is key to securing $2.9 billion in International Monetary Fund (IMF) bailout money and releasing more funds.