The Central Bank of Sri Lanka (CBSL) has chosen to keep the Overnight Policy Rate (OPR) steady at 7.75%, following the latest meeting of the Monetary Policy Board held yesterday (25).
According to the CBSL, the decision was based on a careful review of domestic and international economic conditions. The Board believes the existing monetary policy settings remain suitable for directing inflation toward the long-term target of 5%.
Headline inflation, measured by the Colombo Consumer Price Index (CCPI), rose for the third straight month in October. However, the Central Bank expects inflation to increase at a slower pace than previously anticipated and gradually align with the target by the second half of 2026.
Core inflation is also projected to rise moderately as economic activity strengthens. The Central Bank noted that medium-term inflation expectations continue to stay firmly anchored around the target.
Additionally, leading indicators show ongoing economic momentum, with private sector credit posting broad-based growth so far in 2025, aided by the relatively low-interest-rate environment.
The CBSL stated that it will keep a close watch on both global and local economic trends and is ready to adjust policies if necessary to ensure inflation remains stable and the economy continues on a sustainable growth path.
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