The Asian Development Bank (ADB), in its latest Asian Development Outlook (ADO) April 2026 report, forecasts a moderation in Sri Lanka's economic growth and a significant rise in inflation for the upcoming year. The country's economic growth is projected to slow to 4.0% in 2026, down from 5.0% in 2025, following two years of robust expansion. Concurrently, inflation is anticipated to increase substantially to 5.2% in 2026, from a negative 0.5% in 2025. These projections are based on an early stabilization scenario for the Middle East conflict, which is identified as a key external factor. The conflict's impact on fuel prices, along with potential disruptions to trade, tourism, and remittances, are cited as primary drivers for the anticipated economic shifts. Looking further ahead, the ADB expects growth to slightly increase to 4.2% and inflation to ease to 4.0% in 2027.
The Pulse
EconomyHOT4h ago