Macroeconomic Forecast Sri Lanka

February 2008 | Macroeconomic Forecasts

BMI View: We are estimating real GDP expansion of 6.3% in 2007, and envisage a deceleration to 6.0% in 2008, because the civil war is clearly escalating. In February we raised our end-08 rupee forecast to LKR108/US$ from LKR111/US$ previously to reflect the currency's recent appreciation, but we still believe that the rupee is vulnerable to external shocks, thanks to its massive trade deficit and runaway inflation.

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