Sri Lanka’s inflation climbed in December for a third straight month as a rebound in economic activity boosted consumption.
The Consumer Price Index (CPI) in Colombo rose four percent from a year ago, a spokesman for the Statistics Department said yesterday.
That is faster than a 3.7 percent gain seen in a Bloomberg survey, and compared to 3.4 percent in November.
The numbers are in line with expectations of the Central Bank of Sri Lanka (CBSL), which last month signalled a pause after cutting interest rates for the fourth time this year to support the nation’s recovery from an unprecedented economic crisis.
Sri Lanka’s economy expanded for the first time in nearly two years in the July-September quarter, underscoring a turnaround stemming from a US$ 3 billion International Monetary Fund (IMF) bailout.
The Washington-based lender earlier this month gave final approval for a US$ 337 million loan payout that will help build risk buffers ahead of national elections due next year.
Sri Lanka is restructuring its debt after defaulting last year for the first time in its history. The authorities are in talks with dollar bondholders after sealing agreements with the South Asian nation’s official creditors.
– Bloomberg
