The International Monetary Fund has concluded its September 10–23 mission to Sri Lanka without announcing a staff-level agreement on the Seventh Review of the country's Extended Fund Facility programme.
In its official end-of-mission statement, the IMF said discussions with the Sri Lankan authorities had been productive but would continue in the near term toward reaching agreement on the parameters and policies needed to conclude the Seventh Review.
This means the Seventh Review has not yet been completed.
The mission's conclusion also does not represent approval of a new IMF disbursement.
### Economy grew 4.2% in second quarter
The IMF said Sri Lanka's economy continued to demonstrate resilience despite successive shocks.
Economic activity expanded by 4.2% in the second quarter of 2026, marking what the IMF described as eleven consecutive quarters of strong growth.
Headline inflation, however, rose to 8% year-on-year in August, which the IMF linked to the global oil-price shock.
The Fund said inflation expectations remain broadly anchored.
Gross official reserves stood at approximately US$6.9 billion at the end of August.
### IMF identifies continuing priorities
The IMF said Sri Lanka continues to face downside economic risks and stressed several policy priorities.
These include:
- developing a strong medium-term revenue strategy and strengthening revenue administration;
- maintaining energy cost recovery;
- executing planned capital investment;
- sustaining governance and structural reforms;
- maintaining prudent macroeconomic policies.
The Fund said moving from economic stabilisation toward broader economic transformation requires continued structural reforms aimed at reducing poverty and improving living standards through strong and inclusive growth.
### Inflation framework
The IMF said it would be prudent for Sri Lanka to maintain the 5% inflation target and the current accountability band to strengthen the credibility of the inflation-targeting framework.
### What happens next
The IMF and Sri Lankan authorities will continue discussions with the objective of reaching a staff-level agreement in the near term.
A staff-level agreement, if subsequently reached, would itself be another stage in the review process and should not be described as Executive Board approval or a disbursement unless those later steps actually occur.