Sri Lanka inflation accelerates to 3.3-pct in May

May 29, 2009 (LBO) – Consumer price inflation in Sri Lanka’s capital Colombo accelerated to 3.3 percent in the 12-months to May from 2.9 percent in April, with prices jumping 2.0 percent during the month, the government’s statistics office said.

Sri Lanka central bank governor Nivard Cabraal has said the index could move below zero before moving up in the second half of 2009.

Meanwhile the moving average of the index, which is a lagging indicator averaged over two years fell to 14.7 percent in May from 16.7 percent in April.

Sri Lanka’s central bank had kept tight monetary policy till late last year and brought down the island’s inflation to the same levels as the rest of the world by the first quarter of 2009.

Sri Lanka’s widely watched Colombo Consumer Price index, which measures rupee inflation, has been falling constantly since September 2008, when it peaked at 207.2 points.

By May the index had fallen steadily to 201.0 points. But this month the index grew by 2.0 percent to 205.1.

Inflation showed up in the food category which grew to 217.7 points from 210.8 a month earlier, the statistics office said. The subcategory on communication also increased to 109.7 from 102.5 percent.

However Sri Lanka’s 12-mon