00:00Meanwhile, Sri Lanka's inflation fight may be entering a new phase.
00:04After aggressive rate hikes and months of price pressure,
00:07its central bank sees light at the end of the tunnel.
00:10Governor Nandadal Wirasinghe told us inflation is on track to return to what the bank's 5% goal,
00:17but much depends on where oil prices go from here.
00:20The baseline scenario is that if oil prices remaining around $80 a barrel for next,
00:27for this end of the year, towards this year and next, then we can manage the situation.
00:32If it remains at that level, I think we can manage inflation.
00:34We are expecting inflation to come down around our target level of 5% in, say,
00:40towards end of this year and early next year.
00:44And Sri Lanka was one of the big winners of 2025 as the economy bounced out of an economic crisis.
00:51Yet, gains have stalled as the energy crisis sparked by the Iran war raises inflation concerns,
00:58particularly impacted as a hotel sector.
01:01For more on his home market, let's bring in Bloomberg Market Reporter Anthony Stephens.
01:05And Anthony, what's really stalling the gains in the Sri Lankan stock market?
01:10Yeah, we should have had this conversation last year.
01:13It was such a good year for Sri Lanka last year, bouncing out of the crisis.
01:16But now, on the way back from the Iran crisis, it's lagging the MSCI frontier market really quite badly.
01:23And that speaks to a lack of energy diversification in the economy vis-a-vis other economies like Pakistan or
01:29Vietnam in the frontier bucket.
01:31There are also much larger economies that are benefiting from the China-plus angle on light manufacturing.
01:37So Sri Lanka is more geared towards tourism, and that is much more leverage to oil prices
01:42from both the domestic front and the aviation front for incoming tourists.
01:46And you're seeing that part of the stock market lag materially.
01:50Alongside that, a lot of domestic demand plays are also struggling as the local population struggles to find fuel and
01:56energy at reasonable prices.
01:57So that stalled out the market quite meaningfully here.
02:00And there's also a lack of new listings in the exciting sectors in the economy.
02:06So there was one listing, Wealth Trust, on the financial side that went so crazy that the market had to
02:12be...
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