Business
Central Bank aware of upside and downside risks to its inflation projections
by Sanath Nanayakkare
The Central Bank forecasts the headline inflation to remain negative in the next few months, deeper than previously projected, but expects it to turn positive thereafter and gradually align with the targeted level of 5% over the medium term, aided by appropriate policy measures.
Attributing larger downward adjustments in energy prices and reduction in volatile food prices to the current negative headline inflation, the Central Bank, however, is keeping its eye on upside and downside risks to inflation projections in the near to medium term.
The Bank says possible upward pressures on the headline inflation could stem from six factors; namely:
- Possible upward pressures on global food and energy prices amidst geopolitical uncertainty
- Possible realisation of demand for higher wages
- Possible adverse weather conditions that could affect agricultural production
- Any deviation from the envisaged fiscal consolidation path
- Possible rupee depreciation at higher levels
- Possible sticky global inflation due to the policy changes in the USA And in relation to downside risks to inflation projections, the Bank cites two key reasons among others, namely.
- Possible price reductions of essentials
- The sustained impact of diminished purchasing power of people
In line with the Central Bank’s near-term projections, the headline inflation remained in negative territory for the third consecutive month, recording a deflation of 2.1% in November 2024 compared to the deflation of 0.8% in October 2024.
Non-Food inflation (Y-o-Y) decelerated further to -3.3% in November 2024 from -1.6% in October 2024. Meanwhile, Food inflation (Y-o-Y) decelerated to 0.6% in November 2024 from 1.0% October 2024. On a month-on-month basis, the CCPI recorded a decline of 0.25% in November 2024 due to 0.02% reduction in the prices of items in the Food category and 0.23% reduction in the prices of items in the Non-Food category.
Meanwhile, core inflation (Y-o-Y), which reflects the underlying inflation trends in the economy, moderated further to 2.7% in November 2024 from 3.0% in October 2024.
The Island Financial Review asked the Central Bank at the press conference last week whether the continuing disinflation would have adverse impacts on production, corporate profitability and labour recruitment and hiring.
Dr. Chandranath Amarasekara- Assistant Governor, Central Bank replied,” We do not expect disinflation to continue for such a long time to have an impact on production. By the end of the second quarter next year, we will see the end of disinflation.”
Business
Global regulators convene in Colombo for key IOSCO enforcement and cooperation discussions
The Securities and Exchange Commission of Sri Lanka (SEC) successfully hosted a series of high-level meetings of the International Organization of Securities Commissions (IOSCO), bringing together leading securities regulators and enforcement officials from around the world to discuss emerging regulatory challenges, strengthen international cooperation, and enhance collective efforts to combat cross-border securities market misconduct.
The meetings, held at the Hilton Colombo from 13 to 16 October 2026, included sessions of the IOSCO Enforcement and Cooperation Committee and its Screening Group (Committee 4/SG), as well as meetings of the Monitoring Group and the Steering Committee. The event attracted approximately 50 senior representatives from securities regulators and exchanges across several jurisdictions, including Australia, Japan, the United States, the United Kingdom, France, Italy, Canada, New Zealand, India, Germany, Belgium, Singapore, China and Spain, reflecting the global significance of the discussions and the growing importance of international regulatory collaboration.
Welcoming delegates to Sri Lanka, Senior Professor D.B.P.H. Dissabandara, Chairman of the SEC, emphasized the critical role of international cooperation in safeguarding market integrity and investor confidence in an increasingly interconnected financial landscape.
“No regulator can effectively address cross-border misconduct in isolation. The speed with which information, transactions and illicit activities can move across borders requires an equally coordinated and timely regulatory response. Strong international cooperation, effective information sharing and mutual trust among regulators are essential to maintaining fair, transparent and resilient capital markets,” he stated.
The discussions focused on a range of enforcement and cooperation matters, including mechanisms for enhancing cross-border information exchange, strengthening investigative collaboration among regulators, addressing increasingly sophisticated forms of securities fraud and market abuse, and promoting the effective implementation of international standards and best practices. Participants also exchanged experiences and insights on emerging enforcement challenges arising from technological developments, digitalization of financial services, and increasingly interconnected global markets.
IOSCO is recognized as the leading international body that brings together the world’s securities regulators and serves as the global standard setter for securities regulation. Through its policy work and cooperative initiatives, IOSCO plays a central role in promoting investor protection, ensuring that markets are fair, efficient and transparent, reducing systemic risk, and strengthening confidence in capital markets worldwide.
Sri Lanka has maintained a strong and active relationship with IOSCO for more than three decades. The SEC became an Ordinary Member of IOSCO in 1993 and has been a signatory to the IOSCO Multilateral Memorandum of Understanding (MMoU) since 2004. The MMoU is the internationally recognised benchmark for cooperation and information sharing among securities regulators and serves as a critical tool in facilitating cross-border investigations and enforcement actions.
Business
Pan Asia Bank partners Ideal Motors to offer leasing solutions
Pan Asia Bank recently entered into a one-year Memorandum of Understanding (MOU) with Ideal Motors (Pvt) Ltd, creating a new financing avenue for customers purchasing vehicles from the authorised Mahindra dealer. The strategic partnership will enable customers of Ideal Motors to access leasing facilities from Pan Asia Bank, making vehicle financing more convenient while supporting their mobility and business requirements. The agreement also provides an opportunity for the Bank to expand its leasing portfolio and strengthen its presence in Sri Lanka’s vehicle financing market.
Ideal Motors is the authorised dealer for the Mahindra vehicle range in Sri Lanka, including the Mahindra Bolero CPU Truck and Scorpio Jeep/Pickup. The vehicles cater to a range of requirements, from commercial and business applications to personal mobility, making accessible financing an important part of the purchasing decision.
The Bank’s vehicle leasing facilities are designed to simplify the financing process, with convenient repayment options and professional support to help customers select a solution suited to their requirements. For customers, the arrangement brings vehicle selection and financing closer together, reducing the need to navigate the two processes separately.
“Our partnership with Ideal Motors enables us to bring financing closer to customers at the point of vehicle purchase. We remain focused on providing convenient and flexible leasing solutions that support both personal mobility and the needs of businesses,” said Naleen Edirisinghe, Director/CEO of Pan Asia Bank.
Pan Asia Bank and Ideal Motors will work closely during the one-year partnership to maximise business opportunities and deliver a seamless financing experience to customers. The collaboration is expected to strengthen both organisations’ ability to respond to demand for commercial and personal vehicles while creating greater value for customers.
Yohan Ebell, Head of Retail Credit, Pan Asia Bank, said: “Through this partnership, we aim to make vehicle financing simpler and more accessible, with leasing solutions designed to meet the varied requirements of Ideal Motors’ customers.”
The collaboration also reflects Pan Asia Bank’s commitment to building partnerships that make financial services more accessible and responsive to the needs of individuals and businesses.
Pan Asia Bank has established a growing presence in vehicle financing, offering leasing solutions designed around customer convenience and flexibility. Its leasing proposition is supported by a nationwide branch network and a customer-focused approach, enabling customers to obtain guidance on financing options while completing their vehicle purchase.
Business
Heritance Hotels and Resorts secures four wins at World Travel Awards 2026
Heritance Hotels and Resorts has secured four distinguished titles at the World Travel Awards 2026, with three national awards recognising its Sri Lankan properties and an international title for Heritance Aarah in the Maldives.
The three Sri Lankan titles recognise Heritance Tea Factory as Sri Lanka’s Leading Heritage Hotel 2026, Heritance Ahungalla as Sri Lanka’s Leading Luxury Hotel 2026, and Heritance Kandalama as Sri Lanka’s Leading Wedding Hotel 2026. Heritance Aarah was named the Indian Ocean’s Leading All-Inclusive Resort 2026.
Internationally recognised within the global travel and tourism industry, the World Travel Awards celebrate excellence across hotels, resorts, and destinations. Recognition at this level affirms the quality, distinctiveness, and consistency of the experiences delivered by Heritance Hotels and Resorts.
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