FINANCIAL CHRONICLE – Sri Lanka’s economy grew 4.8 percent in the fourth quarter of 2025, with full-year growth estimated at 5.0 percent, helped by lower inflation and exchange rate stability, the state statistics office said.

Sri Lanka’s economy grew 5.6 percent in the same quarter of the previous year.

“The economic climate in 2025 was favorable for a solid economic performance through a few aspects; entrepreneur-friendly inflation started to rise early in the third quarter of 2025, coupled with the mostly stable exchange rate amid continuously decreasing interest rates,” the Statistics Department said.

The agriculture sector grew 1.4 percent in 2025, with industry growing 7.8 percent and services up 3.3 percent for the full year 2025.

In the fourth quarter, agriculture contracted by 2.1 percent, industry surged 7.3 percent, and services grew 3.1 percent.

Sri Lanka is recovering from the worst currency crisis in the history of the central bank after aggressive monetary and fiscal stimulus, which ended in a sovereign default in 2022.

Interest rates had also fallen with some expansion in private credit. (Colombo/Mar18/2026)