Sri Lanka spreads some prices over two months in inflation reports

Standing left to right – Mr. Dinesh Jebamani (Chief Manager Liability Product Management and New Age Media – Seylan Bank), Mr.Sudesh Peiris (Senior Manager – Digital Banking Channels – Seylan Bank), Ms. S.Senevirathne (Representative of the Revenue Department – Western Province), Mr. Tilan Wijeyesekera (Deputy General Manager – Retail Banking – Seylan Bank) and Mr. Malik Wickremanayaka (Deputy General Manager – Operations – Seylan Bank)

Sept 22, 2008 (LBO) – Sri Lanka is calculating point-to-point inflation by spreading some price increases across two months, an official said, adding to a series of recent actions that is casting a shadow over the integrity of the country’s economic statistics.

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Sri Lanka’s statistics office says it is allocating changes in some prices over two months instead of taking the full increase in one period.

“This is only for administrative prices,” the head of the price indices unit at the statistic office, D C A Gunewardena, said when questioned by reporters.

‘Administrative’ prices is usually a label attached to prices which the government interferes with. Such prices could include train fares, bus fares and fuel.

Gunewardena said the statistics office used the period of the final week of one month and three weeks of the following month to calculate its inflation number and there was a “practical difficulty” to be overcome.

If an ‘administered price’ is raised in the first week of the month, only three weeks worth of price increases are taken. The balance is carried forward, he said.

Gunewardena said the statistics office