CCPI inflation holds at 8% in Sept.

Sri Lanka’s Colombo Consumer Price Index (CCPI)-based headline inflation held at a three-year high of 8% year-on-year (YoY) in September, unchanged from August. It stayed above the Central Bank of Sri Lanka’s (CBSL) 5% ±2% inflation target band for a third consecutive month, though it came in below both Bloomberg’s estimate of 8.4% and a Bloomberg poll consensus estimate of 8.3%.

Headline inflation has risen from 7.3% in July, when it first breached the upper limit of the target band.In a statement yesterday, the CBSL said food inflation increased to 8.7% in September from 8.5% in August, while non-food inflation was unchanged at 7.7%. Food inflation stood at 6.3% in July.

On a month-on-month basis, the CCPI rose 0.19% in September, down from 0.28% in August. The food category contributed 0.15 percentage points to the increase, largely owing to higher prices of fresh fruit and big onion, while the non-food category contributed 0.04 percentage points, mainly due to higher prices in the education subcategory.

Core inflation, which strips out volatile items such as food and energy, accelerated to 5.4% year-on-year (YoY) in September from 5.1% in August and 4.4% in July. The CBSL said realised average inflation for the third quarter of 2026 was in line with its recent projections. According to projections made at the September monetary policy round, headline inflation is expected to remain in high single digits through the first quarter of 2027 before easing towards the 5% target.