### CBSL Chief: No Immediate Restrictions Despite ME Conflict 📈

Central Bank Governor Dr. Nandalal Weerasinghe confirms that Sri Lanka’s improved macroeconomic buffers eliminate the need for new import or capital controls amidst Middle East tensions. • Foreign Inflows & Resilience Workers’ remittances remain the economy's strongest pillar. February inflows surged 33% YoY to US$ 729 Mn. Cumulative remittances for the first two months of 2026 reached a record US$ 1.48 Bn (+32% YoY). There are currently no signs of large-scale worker returns from the Middle East. • Sectoral Impact • Tourism: Arrivals have dropped by 17% due to geopolitical uncertainty. Cumulative earnings for the period fell 4.9% YoY to US$ 730.3 Mn. • Energy & Inflation: Despite global oil volatility, March inflation is projected at 2%. The CBSL expects inflation to stabilize around 5% by Q2 2026, even with recent energy price hikes. • Policy & Exchange Rate The CBSL will maintain a flexible exchange rate, intervening only to curb excessive volatility. The Governor emphasized that structural reforms in banking, labour, and land must proceed to build long-term economic resilience. • Outlook Sri Lanka is positioned to absorb external shocks better than in 2022. While adjustments to policy paths may occur if the crisis persists, current buffers are deemed sufficient to manage short-term global disruptions.