The Central Bank continues to maintain its year-end inflation range at the original mid-single digit levels—4 percent to 6 percent—as the economy is growing far below its potential due to the coronavirus impact which undermines demand-driven price pressures.
Consumer prices in the Colombo district decelerated in August from July as non-food prices dropped while the prices of the food basket continued its way up.
The consumer prices measured based on the Colombo Consumer Price Index (CCPI) rose 4.1 percent during the twelve months to August, decelerating from 4.2 percent in July. July prices mainly rose due to non-food items such as healthcare, clothing and transport as people mostly returned to their normal routine as the coronavirus
fears dissipated.
This was mainly driven by the statistical effect of the high base prevailed in August 2019. Food inflation (Y-o-Y) increased to 12.3 per cent in August 2020 from 10.9 per cent in July 2020, whereas Non-food inflation (Y-o-Y) decreased to 0.8 per cent in August 2020 from 1.5 per cent in July 2020, Central Bank announced.
The change in the CCPI measured on an annual average basis remained unchanged at 4.8 per cent in August 2020. Monthly change of CCPI recorded at 0.0 per cent in August 2020.
This was due to setting-off the price increase of 0.1 per cent in the Food category, with the price decline observed in the Non-food category by the same magnitude.
(LIN)