Sri Lanka's key inflation rate eases to 61% in November

The pace of food inflation slowed from an all-time high of 94.9% in September

Published : 30 Nov 2022, 10:37 AM
Updated : 30 Nov 2022, 10:37 AM

Sri Lanka's key inflation rate eased to 61% in November from 66% in October, the crisis-struck country's statistics department said on Wednesday.

The Colombo Consumer Price Index (CCPI) reflected a 73.7% jump in food prices from a year earlier and a 54.5% climb in the non-food group, the Census and Statistics Department said in a statement.

However, the pace of food inflation slowed from an all-time high of 94.9% in September.

Sri Lanka has been struggling with soaring inflation for about a year, partly triggered by its worst financial crisis in seven decades and an ill-thought out seven month ban on chemical fertiliser implemented last year.

"This is in line with expectations. Food prices are coming down faster and while it is hard to predict, inflation could reach mid-to-high 50s at the end of 2022," said Thilina Panduwawala, head of research at Frontier Research.

Central Bank of Sri Lanka Governor Nandalal Weerasinghe predicted that if the current trend of monetary policy was followed, inflation could drop to 4%-5% by the end of next year.

In an effort to tame prices and stabilise markets, the bank held rates in its last policy announcement on Nov 24. 

The CCPI, released at the end of each month and closely watched by central bank policymakers, acts as a lead indicator for broader national prices and shows how inflation is evolving in Colombo, Sri Lanka's biggest city.

Sri Lanka's other main inflation measure, the National Consumer Price Index (NCPI), which captures broader retail price inflation, slowed to 70.6% last month after hitting a record 73.7% in September.