The Colombo Consumer Price Index (CCPI, 2021=100) based headline inflation (year-on-year, Y-o-Y) accelerated further in June 2026, as expected, reflecting the pass-through of continued upward adjustments to domestic energy prices due to the Middle East conflict. Accordingly, headline inflation (Y-o-Y) was recorded at 6.8% in June 2026 compared to 5.5% in May 2026.
Non-Food inflation (Y-o-Y) accelerated to 8.4% in June 2026 from 7.8% in May 2026, contributing mainly to the increase in headline inflation. Food inflation (Y-o-Y) also accelerated to 3.6% in June 2026 from 0.9% in May 2026.
On a month-on-month basis, the CCPI recorded an increase of 2.1% in June 2026. This increase was driven by the Food category, which contributed 1.4 percentage points, largely owing to the increase in prices of Fish and Vegetables, while the Non-Food category contributed 0.7 percentage points.
Meanwhile, core inflation (Y-o-Y) accelerated marginally to 4.0% in June 2026 from 3.9% in May 2026.
Realised quarterly average inflation for Q2-2026 remained broadly in line with the Central Bank’s recent inflation projections. Inflation projections made at the monetary policy round in May 2026, based on available information and assumptions, indicate that headline inflation is likely to remain above the target of 5% in the period ahead, before easing and stabilising around the target over the medium term, supported by appropriate policy measures. However, amid the fluid nature of the tensions in the Middle East and the wide-ranging spillovers across both global and domestic economic activity, the domestic inflation outlook remains subject to elevated uncertainty.
