National inflation in May decelerates to 7.1% over base effect

Sri Lanka’s countrywide inflation measured by the National Consumer Price Index (NCPI) decelerated to 7.1 percent in May from 8.7 percent a month ago on a yearon-year basis.

This deceleration is mainly due to the base effect amid a monthly increase in the NCPI. Both food and Non-food categories contributed towards the year-on-year inflation in May 2017.

The change in the NCPI measured on an annual average basis increased to 6.1 percent in May from 6.0 percent in April 2017.

When the monthly change is considered, the NCPI increased from 121.0 index points in April 2017 to 121.8 index points in May 2017.

This monthly increase was mainly due to the increase in the prices of the items in the food category.

Within the Food category, the prices of vegetables, red onions, fresh fish, rice and coconuts increased during the month.

In the Non-food category, the prices of items in clothing and footwear; housing, water, electricity, gas and other fuels (materials for maintenance); furnishing, household equipment and routine household maintenance; transport (tyres, tubes, spare parts and lubricating oil) and miscellaneous goods and services sub-categories increased.

The prices in health; education and restaurants and hotels sub-categories also recorded marginal increases. The prices of certain items within the alcoholic beverages and tobacco subcategory decreased during May 2017.

Meanwhile, the prices in communication; and recreation and culture sub-categories remained unchanged during the month.

The NCPI Core inflation, which reflects the underlying inflation in the economy, decreased significantly to 4.7 percent in May 2017 from 5.9 percent in April 2017 on a year-on-year basis.