Inflation Rising In Sri Lanka – World Bank Report

World Bank in a report states Sri Lanka must reduce high budget deficits and public debt. It states South Asia's fiscal deficit, including that of Sri Lanka’s, is the highest of all regions and public debt at 60 percent of Gross Domestic Product might prompt investors to penalize the region like they did to European countries like Greece.

Central banks need to knock off excess liquidity so it does not cause inflation states the report adding Fiscal authorities need to start correcting fiscal imbalances with sustainable fiscal policies.

World Bank also warned that there were indications inflation was raising its head again. Inflation reached an 11 month peak of 6.9 percent in February 2010 with two-thirds of the increase attributable to food prices.