ECONOMYNEXT – Sri Lanka’s nation-wide inflation index, as measured by the National Consumer Price Index (NCPI) on a year-on-year basis, was 8.1 percent in September 2026, steady from a month ago, data from the state statistics office showed.

It stood at its highest since June 2023, official data showed.

The NCPI, an alternative to the widely watched Colombo Consumer Price Index, rose 0.1 percent, in September 2026, registering 224.2 compared to 223.9 in August 2026.

The year-on-year inflation of the food group increased to 6.9 percent in August 2026 from 6.6 percent in August 2026.

The year-on-year inflation of the non-food group slowed to 9.1 percent from 9.3 percent a month ago.

The NCPI includes 485 items representing consumption of Sri Lanka households. It is compiled three weeks after the end of each month and the release of the key index Colombo Consumer Price Index (CCPI). (Colombo/October 21/2026)

ECONOMYNEXT – Sri Lanka’s Inland Revenue Department (IRD) and the Excise Department (ED) entered into an agreement to share intelligence information aimed at preventing tax evasion and money laundering, the Finance Ministry said on Wednesday.

The Memorandum of Understanding (MoU)  will see a joint mechanism and conducting parallel investigations over the information they share.

“In parallel with Sri Lanka’s third mutual evaluation against money laundering, terrorist financing, and proliferation financing, offenses relating to tax evasion.. and offenses falling under the Excise Ordinance have been designated as ‘Unlawful Activities’ related to money laundering with effect from August 4, 2026, via the Prevention of Money Laundering (Amendment) Act,” the Finance Ministry said in a statement.

It said the new MoU will establish a mechanism to act collectively against such offenses by optimizing state resources.

Through this initiative, the government expects to achieve its revenue targets by expanding audits against tax evasion, minimizing illicit financial flows, and streamlining revenue collection, the Ministry said.

Historically, institutional silos and a severe lack of inter-agency data integration between the IRD and the ED created systemic loopholes that enabled widespread revenue leakage.

Operating as isolated entities with incompatible record-keeping systems, the two revenue-collecting bodies could not cross-verify transactional, production, and tax filings in real time.

This operational disconnect allowed non-compliant businesses and manufacturers to report low turnover figures to the IRD for direct tax assessments while simultaneously under reporting production volumes or duty liabilities to the Excise Department.

The absence of automated intelligence sharing restricted the state’s capacity to conduct parallel financial audits and limited visibility over illicit financial flows, tax evasion schemes, and black-market trade in excisable goods, analysts say.

Consequently, they say, uncoordinated oversight severely weakened tax compliance enforcement, eroding the government’s tax-to-GDP ratio and hindering the optimal realization of national revenue targets. (Colombo/October 21/2026)

ECONOMYNEXT – Sri Lanka’s rupee closed weaker at 331.90/332.05 to the US dollar in the spot market on Wednesday, from 331.60/70 the previous day, while bond yields closed steady to lower on selected tenors, dealers said.

A bond maturing on 15.09.2029 closed at 11.05/15 percent, down from 11.10/15 percent.

A bond maturing on 01.08.2030 closed at 11.50/60 percent, down from 11.55/63 percent.

A bond maturing on 15.10.2030 closed at 11.55/65 percent, down from 11.60/65 percent.

A bond maturing on 01.12.2031 closed at 11.80/90 percent, up from 11.80/88 percent.

A bond maturing on 15.01.2033 closed at 12.13/18 percent, down from 12.15/20 percent.

A bond maturing on 15.10.2034 closed at 12.30/40 percent, down from 12.40/50 percent. (Colombo/Oct21/2026)

ECONOMYNEXT – Sri Lanka’s Treasury bill yields rose on the shorter tenor at Wednesday’s auction, with 80.61 billion rupees of bills sold of an offered 100 billion, data from the Public Debt Management Office showed.

The 3-month bill was up 2 basis points at 9.2 percent, with 40 billion rupees offered and 70.39 billion rupees sold.

The 6-month bill was unchanged at 9.44 percent, with 35 billion rupees offered and 3.92 billion rupees sold.

The 12-month bill was unchanged at 9.95 percent, with 25 billion rupees offered and 6.29 billion rupees sold.

The 6- and 12-month bills are available on tap. (Colombo/Oct21/2026)

ECONOMYNEXT – Sri Lanka’s Colombo Stock Exchange closed down on Wednesday, CSE data showed, with the benchmark All Share Price Index moving down 0.28 percent.

The ASPI was down 56.48 points at 19,927.30, while the more liquid S&P SL20 was down 0.43 percent, or 24.60 points, at 5,656.91.

Positive contributors to the ASPI were Distilleries Company of Sri Lanka (up 1.54 percent at 52.80 rupees), PGP Glass Ceylon (up 1.63 percent at 56.10 rupees), Singer (Sri Lanka) (up 1.00 percent at 70.80 rupees), Hatton National Bank (up 0.27 percent at 374.25 rupees), and Asiri Hospital Holdings (up 2.46 percent at 25.00 rupees).

Carson Cumberbatch (down 1.78 percent at 663.25 rupees), Bukit Darah (down 1.65 percent at 820.50 rupees), John Keells Holdings (down 1.12 percent at 17.60 rupees), Hayleys (down 0.57 percent at 219.50 rupees), and Commercial Bank of Ceylon (down 0.51 percent at 197.00 rupees) were top negative contributors.

Crossings were recorded in The Fortress Resorts (729.69 million rupees), Sampath Bank (55.40 million rupees), Hatton National Bank (26.05 million rupees), Ceylon Hospitals (22.43 million rupees), and John Keells Holdings (21.12 million rupees) Dewangi De Silva, Assistant Manager – Research at NDB Securities said.

Market turnover was 1.5 billion rupees. Consumer services led turnover with 738.50 million rupees.

Industrial Asphalts was transferred to the Colombo Stock Exchange Watch List after its external auditor, B R De Silva & Co, issued a Disclaimer of Opinion on its financial statements for the year ended March 31, 2026.

The company’s board is disputing the auditor’s findings and has outlined a six-month window to resolve the disputes before risking a trading suspension. (Colombo/Oct21/2026)

ECONOMYNEXT – Sri Lanka listed firm Industrial Asphalts has been moved to the Colombo Stock Exchange (CSE) Watch List after its external auditor, B R De Silva & Co, issued a Disclaimer of Opinion on its financial statements for the year ended March 31, 2026.

The firm’s board is disputing the auditor’s findings and has outlined a six-month window to resolve the disputes before risking a trading suspension.

The full statement is reproduced below:

INDUSTRIAL ASPHALTS (CEYLON) PLC CORPORATE DISCLOSURE

In terms of Section 7.5(d)(i)(A)(5) of the Listing Rules of the Colombo Stock Exchange, we write to provide below mentioned details in relation to the Disclaimer of Opinion contained in the Audited Financial Statements of Industrial Asphalts (Ceylon) PLC for the year ended 31st March 2026.

a) Disclaimer of Opinion and Transfer of Company’s Securities to the Watch List –
The Securities of the Company had been transferred to the Watch List of the CSE with effect from 20th October 2026 due to the Disclaimer of Opinion contained in the Independent Auditor’s Report in the Audited Financial Statements for the year ended 31st March 2026.

The main two (2) bases for the Disclaimer of Opinion are the fair valuation of the investment property and the advance given to the Key Management Personnel (KMP) during the year.

We wish to draw your attention to the following facts in relation to the investment property valuation and the advance paid to the KMP during the year.

a1. Disagreement with Investment Property Valuation by KPMG Real Estate & Valuation Services (Pvt) Ltd –
The external auditors, B.R. De Silva & Co., had disagreements with the investment property valuation report for 31st March 2026 which was valued by KPMG Real Estate & Valuation Services (Pvt) Ltd, despite detailed explanation and further written clarification provided by the KPMG Real Estate team

Subsequent to publishing the Annual Report 2026, KPMG Real Estate & Valuation Services (Pvt) Ltd has provided written clarification that they have clearly provided the methodology, market analysis and principal assumptions applied in arriving at the fair value. The Board of Directors are not in agreement to the disclaimer of opinion and the reasons for disagreement was not mentioned by the auditors, B R De Silva & Co.

a2. Disputing the Legal Opinion by expert legal firm –
The Board Audit Committee obtained an independent legal opinion from an expert legal firm confirming the validity of the advance payment made to Key Management Personnel during the year, which was subsequently settled in full. The auditors, B.R. De Silva & Co., have rejected the expert legal opinion given by the legal firm which caused a basis for Disclaimer of Opinion stating that their internal expert has rejected it. The Board obtained a second legal opinion which was consistent with the legal opinion given by expert legal firm.

Deferred Tax impact on revaluation of Investment Property –
The Company had been following the policy of recognizing the investment property revaluation surplus over the years when arriving at the deferred tax impact on the temporary difference. The external auditors, B.R. De Silva & Co., had a different view during FY 2025/26, which caused a basis for Disclaimer of Opinion in the Independent Auditor’s Report.

b) Remedial action proposed to be taken by the Company to resolve the matters giving rise to the Disclaimer of Opinion –
The Board of Directors will continue to seek clarification from the auditors, B R De Silva & Co., with the reasons for disputing the KPMG Valuation and the reason for not agreeing to the expert legal opinion together with the profiles of their internal experts who disputed these reports.

The Board of Directors would take necessary steps to ensure an independent audit opinion is obtained from an audit firm to present the true and fair view of the financial statements based on the CSE Listing Rules to transfer the company out of the watch list and the AGM date will be notified in due course to take this process forward.

c) Time period within which the remedial action will be taken by the Company –

The Board intends to resolve the matters giving rise to the Disclaimer of Opinion within a maximum time period of six months as set out in Section 7.5(d)(i)(A) of the CSE Listing Rules.

d) Additional Statements as per section 7.5(d)(i)(A)(5)(d) of the CSE Listing Rules –

i. In the event of any deviation from the proposed remedial action, the extent of the deviation shall be communicated to the investors by way of a subsequent announcement to the Market via the Exchange within one (01) Market Day from the date of obtaining the approval of the Board of Directors of the Company for such deviation;

ii. In the event the matters giving rise to the disclaimer of opinion are not resolved within a period of six (06) months from the date of transferring the Securities of the Company to the Watch List, the trading of Securities of the Company shall be suspended. In the event the trading suspension continues for a period in excess of twelve (12) months, the Securities of the Company shall be delisted by the Board of Directors of the CSE in terms of Section 14 of the Listing Rules.

iii. In the event the matters giving rise to the disclaimer of opinion are resolved, such fact shall be announced to the Market via the CSE in the form of a declaration by the Board of Directors of the Company which shall be accompanied with a confirmation issued by the Audit Committee of the Company stating that the matters giving rise to the disclaimer of opinion have been resolved. (Colombo/Oct21/2026)