News & market updates

Ceylon Chamber welcomed IMF approval of the combined 5th and 6th EFF reviews, unlocking about $695m in financing, and urged continued reforms to preserve macro stability amid external pressures from the Middle East. It called for a digital fuel QR system, clearer policy communication, and accelerated reforms to boost competitiveness in trade, tourism, logistics and digitalisation.

LAUGFS Gas PLC's Director/Cluster CEO Dr. Niroshan J Pieries and LAUGFS Holdings' Group Executive Vice Chairman Mithila Wegapitiya received the 45 Under 45 Leadership Excellence Platinum Awards from the Global CEO Forum. The recognition highlights the group's focus on leadership, innovation and digital transformation.

Sri Lanka raised retail fuel prices effective May 31 (Auto Diesel +Rs15 to Rs407/L; Octane 92 +Rs24 to Rs434; Super Diesel +Rs20 to Rs478; Super Petrol +Rs25 to Rs495; Kerosene +Rs20 to Rs285), as the fuel import bill more than doubled to US$886m in April and prices near 2022 crisis levels.

Sri Lanka's current account moved into a deficit in April 2026, driven by a wider trade gap from higher fuel (US$886m in April) and vehicle imports and weaker tourist earnings; the Jan–Apr trade deficit rose to US$3.7bn from US$2.3bn a year earlier. Gross official reserves were about US$6.8bn and the rupee had depreciated 5.4% YTD by end‑May.

Sri Lanka's monthly oil import bill rose 149.9% to US$886 million in April as global fuel prices climbed after the Middle East escalation, with fuel accounting for 36% of April's total imports of US$2,457 million. Jan–Apr fuel spending reached US$2,167.7m, up from US$1,411.4m a year earlier.

Sri Lanka's CCPI rose to 5.5% in May 2026, a 27-month high driven by a c.40% fuel price increase that pushed up both food and non-food items. The central bank this week raised the policy rate by 100 basis points to curb demand-driven inflation.

The Ceylon Chamber of Commerce welcomed IMF approval of Sri Lanka’s 5th and 6th reviews, unlocking about USD 695 million under the EFF, and urged continued engagement and structural reforms to preserve macro stability, support investor confidence and address exchange-rate and energy pressures.

Colombo headline inflation rose to 5.5% year‑on‑year in May 2026 from 5.4% in April, driven by higher non-food prices—notably housing, L.P. gas and petrol—while food inflation eased to 0.9%. Core inflation edged up to 3.9% and inflation is expected to remain above the 5% target near term.

FTZMA met the BOI to press for extending VAT exemptions/zero-rating to indirect/deemed exporters to avoid 18% VAT on locally sourced raw materials. They also raised diesel price disparity between CPC and LIOC, proposed fuel sheds, and noted BOI will retain import/export services while recruiting staff.

German business and government officials at the Sri Lankan‑German Business Forum 2026 said Germany views Sri Lanka as a strategic Indo‑Pacific partner and urged faster reforms and policy consistency to unlock investment in logistics, renewable energy, infrastructure and tourism.

IMF Mission Chief Evan Papageorgiou said Sri Lanka’s monetary policy remains broadly appropriate despite a 100-basis-point CBSL rate hike and the IMF approving combined Fifth and Sixth EFF reviews that unlock about $700m. He expects inflation to stay near the 5% target and defended a flexible rupee as a shock absorber against external (including oil) shocks.

President Anura Kumara Dissanayake declared 15 categories of public services — including electricity, fuel distribution, healthcare, transport, ports/airports, water, telecoms, banking and insurance — as essential under the Essential Public Services Act to ensure uninterrupted services in post-disaster conditions.

Ceylon Chamber of Commerce welcomed IMF approval of the 5th and 6th EFF reviews, enabling Sri Lanka to access about USD 695 million, and urged continued reform momentum to preserve macroeconomic stability amid external pressures. It reiterated measures including optimizing the fuel QR digital platform, clearer policy communication, and accelerating reforms in trade, tourism, logistics and digitalisation.

The Board of Investment launched the 'Ready to Invest' digital platform showcasing 30 pre-structured, shovel-ready projects across eight priority sectors to attract international capital. BOI says USD 1.9bn of approved projects are ready to break ground, with a further USD 1.4bn in the pipeline.

Sri Lanka's ASPI rose 0.50% to 22,309.23 midday Friday, with turnover Rs.240.5m and capital goods leading turnover at Rs.94.3m. Top movers included Access Engineering, Aitken Spence (declared Rs.4 tax-exempt dividend), Hemas and Central Finance while SMB Finance, Watawala, John Keells and Windforce fell.

Oil futures fell over 1% and were headed for their steepest weekly drop since early April after reports the U.S. and Iran agreed to extend a ceasefire and ease shipping through the Strait of Hormuz, with Brent at $92.67 and U.S. crude at $87.64. Analysts said reopening the strait could ease supply constraints but upstream production and refinery output recovery will be gradual.

365 Future Energy will visit Sri Lanka on 1 June 2026 to explore sustainable energy investment and technology partnerships, focusing on renewable projects, battery energy storage systems, EV charging infrastructure and smart-grid opportunities.

Indian CEO Forum re-elected Kishore Reddy as president at its AGM and reaffirmed commitment to deepen India–Sri Lanka business ties; Indian High Commissioner Santosh Jha urged investment, an upgraded FTA and cooperation across tourism, IT, infrastructure, manufacturing and services.

Speakers at the Sri Lanka Brand Forum Leadership Summit urged companies to redesign strategy for a new era of permanent volatility, prioritising employee wellbeing, organisational resilience (slack resources), decentralised decision-making, and long-term purpose-driven social programs.

The BOI launched 'Ready to Invest', a digital platform showcasing over $3bn of investor-ready projects across eight priority sectors. BOI said Sri Lanka attracted $1.06bn FDI in 2025 and about $1.9bn of BOI-approved projects are set to commence, led by urban/mixed-use ($970m), manufacturing ($650m), tourism ($400m) and logistics ($385m).

Oil prices jumped over 3% after Iran’s Revolutionary Guards said they targeted a U.S. airbase; Brent rose $3.51 (3.72%) to $97.80/bbl and WTI rose $3.31 (3.73%) to $91.99 amid supply concerns and falling U.S. crude inventories.

IMF Executive Board completed the combined Fifth and Sixth reviews of Sri Lanka’s EFF, unlocking SDR508 million (≈US$695m) in immediate financing. Program performance was generally strong, but some continuous criteria were missed and risks from the Middle East war and Cyclone Ditwah weaken the outlook.

IMF approved a US$695m disbursement to Sri Lanka under its EFF despite breaches including intensified import controls and a cyberattack that led to a missed US$2.5m external payment; authorities requested a waiver and pledged corrective actions.

Colombo stocks recovered after the CBSL hiked policy rates by 100bps, with the ASPI up 0.11% at 22,199.23 and turnover around Rs.1.86bn. DIAL, CCS, BREW, CARS and NDB were top positive contributors; VLL saw net foreign buying while AAIC saw net foreign selling and Food & Beverage led turnover.

Asian shares rose and Brent crude traded near $100/bbl as markets awaited developments in US‑Iran talks and central bank commentary on inflation and interest rates. Investors also tracked currency moves, a likely RBNZ rate hold and gains in gold.

Central Bank Governor Nandalal Weerasinghe said the IMF-supported EFF program allows flexibility for policy adjustments, including targeted subsidies and revisions to key performance targets. He said the IMF Executive Board will approve the combined fifth and sixth reviews on Wednesday and that NIR targets and fuel pricing remain under periodic review.

Cabinet approved the "Surakimu Lanka" National Energy Security Mission to cut fuel import costs and boost energy resilience by shifting demand toward renewable (solar/hydro) generation, improving energy efficiency and coordinating public awareness and state agencies.

Ceylon Petroleum Corporation says Sri Lanka has sufficient fuel stocks to meet domestic demand until end-July; two crude shipments are due on 28 and 31 May and a sharp near-term rise in domestic fuel prices is not expected.

ISO has published a Chinese-developed standard for corrosion testing of conducting alloys in AC conditions and IEC approved a Chinese-led offshore wind standard; the measures aim to improve conductor lifespan and could cut maintenance/operational costs by over 10%.

Evolution Auto, in collaboration with EVO Charge, launched a 60kW dual-gun DC fast charging station at its Peliyagoda After Sales Complex, offering 24/7 charging for two vehicles simultaneously and introductory free/50% discount from 20 May to 21 June.