Exclusive-Sri Lanka central bank sees no need for further rate hikes this year, governor says

COLOMBO, Aug 11 - Sri Lanka's central bank sees no need for more interest rate increases this year after its big, unexpected hike in May, with inflation expected to peak around current levels before easing back towards the 5 per cent target next year, Governor P. Nandalal Weerasinghe told Reuters on Tuesday.Sri Lanka's central bank surprised the markets with a 100 basis-point hike in May, its first increase in more than three years, to contain inflation fueled by the Iran war. Analysts said the move put at risk the fragile, IMF-backed recovery taking hold in the economy.Weerasinghe said the May hike was a "proactive" move taken because the central bank expected inflation to rise to 7 per cent, and current inflation was broadly on expected lines."We need to monitor ... whether there will be