FX.co ★ Sri Lanka Inflation Holds at 2.1% in December

In December 2025, Colombo, the capital of Sri Lanka, saw its annual inflation steady at 2.1%. This rate, while the highest since July 2024, fell short of market predictions of 2.4%. This is the third consecutive month maintaining this inflation rate. The increase was primarily driven by food prices, which accounted for 0.97 percentage points of the rise, with significant contributions from coconuts (+0.28 points), milk powder (+0.28 points), vegetables (+0.44 points), sea fish (+0.40 points), and coconut oil (+0.13 points). Conversely, there were marked decreases in prices for rice, big onions, dhal mysoor, yogurt, and sugar. Non-food items added 1.18 points to the inflation rate, with notable increases in education (+0.27 points), restaurant and hotel services (+0.26 points), health (+0.19 points), furniture and maintenance (+0.12 points), and clothing (+0.11 points). However, petrol (-0.20 points) and electricity (-0.19 points) exerted downward pressure. On a month-to-month basis, consumer prices in December rose by 1.2%, bouncing back from a 0.2% decline experienced in November.