eager to pick up cheap bargains for Christmas, and vendors said there was a visible increase in demand in the resurgent economy after a slump last year. The mood is optimistic and Colombo vibrant with well-lit, heavily decorated shopping malls beckoning to potential customers -- a stark change from last year, when suspected Liberation Tigers of Tamil Eelam (LTTE) guerrillas bombed the Central Bank and a passenger train in a suburb of the capital. More than 150 people were killed and nearly 1,500 injured in the attacks. The gloom was aggravated by an economic slump that followed a prolonged drought and power cuts, which hit industrial and agricultural production. But this year, the economy has bounced back after ample rains, with gross domestic product forecast to rise by six percent against a 3.8 percent increase in 1996. Michael Constance, manager of Abans showrooms, said shops had started Christmas sales early this year and were offering a range of new products, confident demand had picked up. Government troops are locked in a seven-month campaign to capture a strategic northern highway from the LTTE rebels, who have been fighting for a separate homeland for minority Tamils in Sri Lanka's north and east since 1983. The latest campaign, launched in May, has been the war's bloodiest for both sides, with more than 1,000 soldiers and 2,500 rebels killed, and thousands more wounded. But threats of more attacks have not deterred people from gathering at shopping malls in the capital and getting on with their Christmas shopping.