Measured by the Colombo Consumer Price Index (CCPO) consumer prices fell to 14.4 percent in December from a peak of 28.2 percent in June.
"We expect this declining trend in inflation to continue in the period ahead, and for the inflation rate to reach a single digit level by mid 2009," Central Bank governor Nivard Cabraal said, unveiling the monetary policy road map for 2009.
"Accordingly, inflation would reach around 8.0 – 9.0 per cent by mid 2009 and will continue the moderated trend."
The central bank is projecting base-case inflation of around 9.0 percent in 2009, best case inflation of around 5.0 percent and a worse case scenario of around 12 percent. In 2008 the central bank predicted inflation of around 10 to