Inflation decreases

Inflation, as measured by the Colombo Consumers' Price Index (CCPI) (2006/07=100), computed by the Department of Census and Statistics, decreased on a year-on-year basis (YoY) to 6.4 per cent in September 2011 for the second consecutive month, from 7.0 per cent in August 2011.

Meanwhile, the annual average inflation moved up marginally to 7.2 per cent in September from 7.1 per cent in the previous month, as a result of the price developments in the preceding twelve month period.

The core inflation (YoY) decreased sharply to 6.9 per cent from 7.8 per cent while in terms of annual average, the core inflation increased slightly to 7.6 per cent in September from 7.5 per cent in August 2011, the Central Bank said.

Meanwhile, the general price level as indicated by the monthly index recorded a marginal increase of 0.3 per cent in September 2011 over the previous month, with the Index increasing in absolute terms to 151.7 from 151.3.

The contribution to the monthly increase in the Index came mainly from price increases in the sub category of food and non alcoholic beverages (0.1 per cent).

Within the Food sub category, prices of almost all varieties of rice, coconut oil, fish and sea food and eggs declined due to improvements in supply, while prices of most varieties of vegetables, fruits, red onions, big onions, chicken, green chillies and limes increased.

Prices in the sub categories of clothing and footwear (0.3 per cent); housing, water, electricity, gas and other fuels (1.0 per cent); furnishing, household equipment and routine household maintenance (0.1 per cent); Recreation and culture (0.6 per cent); and miscellaneous goods and services (0.2 per cent) increased.

Meanwhile, the prices in the sub categories of health; transport; communication; and education remained unchanged during the month, the Bank said.