Analysis by Region - Emerging Markets - Sri Lanka

Sri Lanka's economy gained 5.0% y/y in 2024, representing the strongest rebound since 2018. The services sector was the biggest contributor to 2024 growth (1.5ppts), followed by the manufacturing and construction sectors. We've maintained our 2025 GDP forecast of 3.8% y/y, but have revised down our 2025 inflation forecast to -0.9% from the previous 3.0%, reflecting the longer-than-expected period of deflation.


Sri Lanka: On the right track but fundamentals still vulnerable
Forecast overview
Recent developments
Short-term outlook
Key drivers of our short-term forecast
Economic risk
Economic risk evaluation
Background
Economic development
Structure of the economy
Balance of payments
Policy and politics

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