Inflation down in August

Inflation, as measured by the Colombo Consumers’ Price Index (CCPI) (2006/07=100) computed by the Department of Census and Statistics, declined to 9.5 percent in August 2012 on a year-on-year (YoY) basis from 9.8 percent in the previous month, mainly due to the price decreases in the food category.

However, the annual average inflation rate rose to 6.3 percent in August 2012 from 6.0 percent in July 2012.

Meanwhile, core inflation decreased to 5.9 percent in August 2012 on a YoY basis, from 6.0 percent in July 2012, while it followed the same trend and reached 5.4 percent on an annual average basis from 5.5 percent in the previous month.

The CCPI declined by 0.6 percent in August 2012 over the previous month, with the Index decreasing in absolute terms to 165.7 from 166.7 in July 2012.

The contribution to the monthly decrease in the Index came mainly from price decreases in the Food and Non-Alcoholic Beverages category (by 1.1 percent). The decrease in the prices of vegetables, fish and sea food, coconuts, coconut oil, potatoes, big onions, red onions, green chillies, eggs and milk powder contributed to the decrease in the food category of CCPI. However, an increase in the prices of rice, sugar, fruits and limes was reported during the month.

Within the Non-Food category, prices increased in the sub-categories of Clothing and Footwear (by 0.2 percent); Furnishing, Household Equipment and Routine Household Maintenance (by 0.2 percent); and Recreation and Culture (by 0.1 per cent).