Central Bank sets 2026 Roadmap for stability and sustainable growth
Sri Lanka’s post-crisis recovery is entering a decisive phase as the Central Bank of Sri Lanka (CB) sets out a forward-looking policy agenda aimed at locking in stability while laying the foundations for durable and inclusive growth. With macroeconomic conditions now steadier, the Central Bank says the challenge ahead is not recovery, but resilience.
Delivering the annual policy address in Colombo on Thursday, Governor of the Central Bank Dr. Nandalal Weerasinghe said the country enters 2026 with enhanced economic resilience, and for its sustenance, discipline and commitment to reforms is essential, irrespective of the challenges posed by climate change and financial risks.
The economy is expected to grow at a pace of 4 to 5 per cent in 2026, driven by the extension of private sector credit growth, improvements in financial conditions, and favourable macroeconomic trends.
Inflation, remaining within the Central Bank’s 5 per cent target range after a period of deflation, is expected to increase in the second half of 2026, although subject to threats from supply events and the reconstruction sector in the aftermath of the cyclone disaster.
Foreign exchange management remains a key policy focus. The CB will continue reviewing regulations governing non-resident investments in Sri Lankan companies and the external commercial borrowings of resident firms.
Supervisory and monitoring systems are to be strengthened through reforms in law enforcement to ensure prudent foreign exchange management.
The comprehensive review of the foreign exchange policy framework, initiated in 2025, will continue in 2026 to align regulations with evolving economic conditions and business financing needs.
The CB also reaffirmed its role in ensuring the orderly and lawful flow of foreign exchange for authorised purposes, while gradually relaxing capital flow measures introduced since 2020.
Enhanced supervision and awareness programmes are expected to strengthen compliance with the regulatory framework.
As custodian of the Employees’ Provident Fund (EPF), which covers nearly 22 million member accounts, the CB announced major service and system upgrades.
A shift towards a paperless environment, expanded digital contribution payments and a unified “One e-system” are expected to reduce delays, improve transparency and speed up benefit payments.
The EPF will also continue prudent investment diversification to safeguard long-term retirement savings.
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