Inflation spike expected in Sri Lanka

The Central Bank of Sri Lanka has warned of higher inflation in July, indicating that the important Colombo Consumer Price Index is set to spike again.

In its July monetary policy statement, the central bank said "there is a risk that the point-to-point inflation in July may increase temporarily, but downward trend in inflation is expected to continue thereafter."

Inflation fell in the first six months of 2007 as the central bank tightened monetary policy, but monthly inflation rose 3% in May