Sri Lanka’s headline inflation, measured by the year-on-year (Y-o-Y) change in the Colombo Consumer Price Index (CCPI), remained in negative territory for the fourth consecutive month, registering a deflation of 1.7% in December 2024, compared to 2.1% in November 2024.
The Central Bank reported that non-food deflation moderated to 3.0% in December from 3.3% in November, while food inflation showed a slight increase, rising to 0.8% from 0.6%.
On a month-on-month basis, the CCPI increased by 1.19% in December, driven by a 1.24% rise in food prices and a 0.06% reduction in non-food prices. Core inflation, reflecting underlying trends, remained stable at 2.7%.
The Central Bank projects that headline inflation will persist in negative territory in the coming months due to the effects of energy price reductions, lower volatile food prices, and the base effect from price increases earlier in 2024. However, inflation is expected to turn positive and gradually align with the medium-term target of 5%, supported by appropriate policy measures.
