FX.co ★ Sri Lanka Inflation Rate Hits Over 3-Year High

The inflation rate in Colombo, Sri Lanka’s capital, rose to 7.3% in July 2026 from 6.8% in June, exceeding market expectations of 6.7%. This was the highest rate since June 2023, driven mainly by a sharp pickup in food prices, with food inflation climbing to a more than three-year high of 6.3% from 3.6% in the previous month. In contrast, non-food inflation remained elevated but eased slightly, slowing to 7.8% from 8.4%.

Within the non-food category, prices accelerated for furnishing and household equipment (5.4% vs 4.5% in June), communication (0.5% vs 0.3%), education (7.2% vs 6.5%), restaurants and hotels (10.6% vs 10.3%), and miscellaneous goods and services (6.2% vs 5.8%). At the same time, inflation cooled in several segments, including transport (17.2% vs 18.7%), clothing and footwear (0.8% vs 1.3%), housing and utilities (5.4% vs 6.3%), and health (3.0% vs 4.2%).

Prices for alcoholic beverages and tobacco were unchanged following a 1.7% increase in June, while costs for recreation and culture declined further (-2.1% vs -1.4%). On a monthly basis, consumer price growth slowed markedly, with the CPI rising just 0.2% in July after a 2.1% gain in the previous month.