Sri Lanka’s headline inflation increased to 8.3-pct in October

Headline inflation, as measured by the year-on-year (Y-o-Y) change in the National Consumer Price Index (NCPI, 2013=100)1, increased to 8.3 percent in October 2021 from 6.2 percent in September 2021 driven by monthly increases of prices of items in both Food and Non-food categories.

Meanwhile, Food inflation (Y-o-Y) increased to 11.7 percent in October 2021 from 10.0 percent in September 2021, while Non-Food inflation (Y-o-Y) also increased to 5.4 percent in October 2021 from 3.0 percent in September 2021.

The NCPI, measured on an annual average basis, increased to 5.7 percent in October 2021 from 5.5 percent in September 2021.

Monthly change of NCPI recorded at 2.12 percent in October 2021 due to increases observed in prices of items in both Food and Non-food categories which were 0.89 percent and 1.23 percent, respectively. Accordingly, within the Food category, prices of milk powder and rice increased.

Further, prices of items in the Non-Food category recorded increases mainly due to price increases observed in Housing, Water, Electricity, Gas and Other Fuels (L.P. Gas and Materials for the maintenance), Restaurant and Hotels, Miscellaneous Goods and Services and Health sub-categories during the month.

Further, year-on-year core inflation increased to 7.2 percent in October 2021 from 4.8 percent in September 2021, while annual average core inflation which remained unchanged for six consecutive months increased to 4.6 percent in October 2021 from 4.4 percent in September 2021.

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Central Bank expects inflation to remain high at around 8-9% in next few months