Inflation remains low in July

The rate of inflation, as measured by the point-to-point change in the Colombo Consumers, Price Index (CCPI) (2002=100), computed by the Department of Census and Statistics, recorded 1.1 per cent in July, 2009 after reaching five year low of 0.9 per cent in June, 2009.

The annual average inflation rate declined further to 10.4 per cent, compared to 12.5 per cent in June 2009, continuing its decelerating path recorded since November, 2008.

The CCPI increased marginally by 0.4 per cent over the previous month, with the Index moving upward to 208.7 from 207.8 in June, 2009. The positive contributions to the monthly increase in the Index arose from the sub categories of Health, Transport, and Housing, water, electricity, gas and other fuels.

More specifically, increases were recorded in the payments to private hospitals and consultation fees to specialists.

The fuel and gas prices were also increased since the first week of July.

However, the full impact of these increases on the index was partly off-set by price decreases in Food and Non alcoholic beverages. The Core inflation, on a point-to-point basis, declined to 6.0 per cent in July, compared to 7.7 per cent in June, 2009.

The monthly core inflation reached 1.1 per cent, and the annual average core inflation declined further to 14.2 per cent in July, 2009 from 15.2 per cent in the previous month.