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Friday, October 30 2026
Friday, October 30 2026
MONETABRIEF – Sri Lanka's inflation measured by the Colombo Consumer Price Index rose 8.3 percent in the 12 months to October 2026, in the wake of currency collapse in the second quarter.
The Colombo Consumer Price Index rose 0.8 points to 209.9 points in October.
Sri Lanka's central bank kept the exchange rate stable for almost two years from September 2022 creating only around 3 percent inflation, using deflationary policy.
Sri Lanka's inflation was lower than the US, in the period, though there are difference in index measurments.
Sri Lanka's inflation was the same as the US until 1978, and the same as UK (under a sterling peg) and India (silver rupee) before that.
In 2026 the rupee was collapsed by dishonoring notes created by monetizing a balance of payments surplus under flexible exchange rate.
Under flexible inflation targeting and printing money to close an output gap (a type of full employment policy) Sri Lanka had a series of currency crises from 2015 to 2019 borrowed heavily and then defaulted in 2022 amid even more aggressive policy to close the gap. (Colombo/Oct30/2026)
| 3 month bill | 9.26% | 1bp ▲ |
| 12-m bill | 9.95% | 2bp - |
| Gold (Ounce) | $4015 | - ▼ |
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