Broad money (M2b) continued to grow at a high pace, recording a growth of 17.8 per cent (year-on-year) in December 2015 compared to 13.4 per cent in December 2014. The year-on-year growth of credit granted to the private sector by commercial banks accelerated during the year, with a growth of 25.1 per cent in December 2015 in comparison to 8.8 per cent in December 2014. In absolute terms, the expansion in private sector credit during 2015 amounted to Rs. 691.4 billion compared to Rs. 223.9 billion in 2014.
The Colombo Consumers’ Price Index (CCPI, 2006/2007=100) based core inflation continued its increasing trend reaching 4.6 per cent in January 2016, on a year-on-year basis, from 0.8 per cent recorded in February 2015. Headline inflation, as measured by the year-on-year change in CCPI decelerated to 0.9 per cent in January 2016, mainly reflecting the impact of low international commodity prices, broadly favourable domestic supply conditions as well as the relatively high base in January 2015. Year-on-year headline inflation based on the National Consumer Price Index (NCPI, 2013=100) was at 4.2 per cent in December 2015.