Sri Lanka's economy continues to face significant challenges as the country grapples with its worst economic crisis since independence.
The country's headline inflation surged to a record high of 39.1% in May, driven by food and fuel shortages, according to the Department of Census and Statistics.
Consumer prices in the capital Colombo rose 39.1% from a year ago, surpassing the median 35% climb forecast by economists in a Bloomberg survey.
Food inflation surged 57.4%, while prices of non-food items jumped 30.6%, the data showed.
The Central Bank of Sri Lanka had predicted price gains to touch 40% amid a shortage of essentials in the absence of dollars to pay for imports.
Tax Hikes and IMF Aid ¶
On the same day, the cabinet reversed the 2019 tax cuts, which have been blamed for ruining the country's finances and setting it on course toward its current crisis.
The country needs $4 billion in emergency funds this year but a deal with the International Monetary Fund for rapid aid remains still in the works.
