Sri Lanka inflation eases to 7.0-pct

Aug 30, 2011 (LBO) – Inflation in Sri Lanka’s capital Colombo rose 7.0 percent in August 2011, easing from 7.5 percent in July, the government’s statistics office said. The revised index fell 0.3 percent in the month.

The food and non-alcoholic beverages fell 0.7 percent in the month, and non-food categories fell 0.1 percent.

Sri Lanka’s rupee is soft-pegged to the US dollar and has appreciated about one percent.

In July inflation in Hong Kong, an area which is hard pegged to the US dollar rose to 7.9 percent, a 16-year high, indicating that inflation flowing through the dollar peg is also high.

But Sri Lanka’s July inflation was also lower than Hong Kong.

Two months ago Sri Lanka’s price index was revised.