Sri Lanka, April 10 -- Sri Lanka's economic growth is projected to moderate from 5.0% in 2025 to 4.0% in 2026, before rising slightly to 4.2% in 2027, according to the Asian Development Bank (ADB).

The ADB further projects inflation to increase from -0.5% to 5.2% in 2026, before easing to 4.0% in 2027.

This forecast is based on an early stabilization scenario for the Middle East conflict, according to theAsian Development Outlook (ADO) April 2026, Asian Development Bank's (ADB) flagship economic publication. Sri Lanka's recovery held firm in 2025 despite the late-year disruption of Cyclone Ditwah, the ADB said.

Private consumption surged amid low inflation and easing interest rates, while remittances hit a record high, as did the prima...