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Movement of Major Inflation Indicators in Sri Lanka ~ Deveconomics
Key
Words
GDP,
Real GDP, Nominal GDP, Inflation, CCPI, NCPI, PPI, GDP Deflator, Core
Inflation, Headline Inflation, Unemployment
Key
highlights
·
Strong
Economic Recovery
Sri Lanka achieved a 5% real GDP growth in 2025, continuing its recovery after
contractions in 2022 (-7.3%) and 2023 (-2.3%).
·
GDP
Expansion Beyond USD 100 Billion
The economy surpassed the USD 100 billion milestone in 2025, reaching USD
108.84 billion (Rs. 32,751 billion).
·
Shifts
in Sectoral Contribution
Agriculture’s share declined, industry expanded, and services slightly
decreased, while taxes less subsidies increased their contribution to GDP.
·
Improvement
in Living Standards
Per capita income rose by about 10%, increasing from USD 4,546 in 2024 to USD
5,003 in 2025.
· Low Inflation and Declining
Unemployment
Inflation remained low across all major indicators (around 2–3%), while
unemployment showed a downward trend, reaching 3.8% in early 2025 before a
slight increase to 4.3% in Q3.
Gross
Domestic Product
Sri
Lanka’s real GDP growth for 2025 was reported at 5%. Although there was
potential to achieve a higher growth rate, this was not realized due to the
impact of Ditwah in the final quarter of the year. Following consecutive
contractions in real GDP in 2022 (-7.3%) and 2023 (-2.3%), the economy
recovered to record a 5% growth rate in 2024, maintaining the same momentum
into 2025.
As
a result, Sri Lanka’s GDP surpassed the USD 100 billion mark in 2025, reaching USD
108.84 billion at current market prices (Rs. 32,751 billion).
The
sectoral composition of GDP shows notable shifts. The share of the agriculture
sector declined from 7.5% in 2024 to 7.1% in 2025. In contrast, the industry
sector increased its contribution from 26.7% to 27.4% over the same period.
Meanwhile, the services sector’s share decreased slightly from 59.2% in 2024 to
58.5% in 2025. Additionally, the contribution of taxes less subsidies rose from
6.6% to 7% during 2024-2025.
Furthermore,
per capita income increased by approximately 10%, rising from USD 4,546 in 2024
to USD 5,003 (Rs. 1,505,371) in 2025.
Inflation
In
2025, CCPI (Core) inflation was recorded at 2.7%, while CCPI (Headline)
inflation stood at 2.1%. During the same period, NCPI (Core) and NCPI
(Headline) increased by 2.6% and 2.9%, respectively. The annual Producer Price
Index (PPI) was reported at 2.5% in 2025.
Overall,
all key indicators reflect a low and stable inflation environment during the
year. The following table summarizes the performance of Sri Lanka’s main
inflation indicators.
Unemployment
Sri
Lanka’s unemployment rate was recorded at 5.5% in 2020 and has shown a
continuous decline in subsequent years, reaching 4.4% in 2024. In 2025, the
unemployment rate stood at 3.8% in both the first and second quarters, before
increasing slightly to 4.3% in the third quarter.
CHART PACK
MOVEMENT
OF GDP
INFLATION
UNEMPLOYMNT
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