In its statement, the CBSL said the decision was made after assessing both domestic and global economic conditions, adding that the current policy stance remains consistent with steering inflation towards its 5% target.
Headline inflation, measured by the Colombo Consumer Price Index (CCPI), turned positive in August 2025, ending a period of eleven consecutive months of deflation. Inflation is projected to gradually rise and reach the target of 5% by mid-2026.
The Bank further noted that reflecting strengthening domestic demand, core inflation is also expected to increase in the near term before stabilising around the headline inflation target. It added that medium-term inflation expectations remain firmly anchored around the 5% objective
