Sri Lanka’s policy rate likely peaked, according to Bloomberg analysts, as the Central Bank kept rates on hold at 8% in January and March. With inflation expected to return in June and align with the CBSL’s 5% target by end-Q1 2026, analysts believed further easing would risk overheating and pressuring the rupee. The forward real rate of around 5.5% was projected to normalize to 2.5%–3% by early next year, supported by a narrowing output gap.