Sri Lanka’s inflation drops to 61% in November

According to a statement issued by the statistics office on Wednesday, the consumer price index in the country’s capital Colombo decreased to 61% from a year earlier. This contrasts with a median score of 62% in a Bloomberg survey of three economists and a score of 66% in October.

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In November, Sri Lanka’s inflation decreased for a second consecutive month due to tighter monetary policy and better supply circumstances.

According to a statement issued by the statistics office on Wednesday, the consumer price index in the country’s capital Colombo decreased to 61% from a year earlier. This contrasts with a median score of 62% in a Bloomberg survey of three economists and a score of 66% in October.

The fall is consistent with predictions that after reaching a peak of close to 70%, consumer prices will begin to decline in the months ahead. To control prices and restrain demand, the Central Bank of Sri Lanka increased borrowing costs by 950 basis points this year, bringing the main rate to 15.5%.

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On November 24, the monetary authority emphasised the necessity to maintain a hawkish stance while maintaining the benchmark interest rate for a third straight meeting in order to stabilise a recession-affected economy.

Falling global commodity prices, aid from friendly nations, and money from multilateral lenders that had been repurposed had all helped Sri Lanka stay stable and alleviate crippling shortages.

The South Asian Island’s debt is now being restructured as the government works to obtain approval from the board of the International Monetary Fund for a $2.9 billion bailout programme.