CCPI based headline inflation edges up slightly in Oct.

The Headline inflation, as measured by the year-on-year (Y-o-Y) change in the Colombo Consumer Price Index increased to 1.5% in October 2023 from 1.3% in September 2023. 

Central Bank (CBSL) said, this slight increase in the headline inflation is mostly in line with its projections envisaged. The Food deflation (Y-o-Y) continued for the fourth consecutive month and remained unchanged at 5.2% in October 2023 compared to the previous month. 

The Non-Food inflation (Y-o-Y) increased to 4.9% in October 2023 from 4.7% in September 2023. Monthly change of CCPI recorded at -0.22% in October 2023 due to the combined effect of price decreases of -0.63% observed in the items of Food category and price increases of 0.41% recorded in the items of Non-Food category. 

The core inflation (Y-o-Y), which reflects the underlying inflation in the economy, decreased to 1.2% in October 2023 from 1.9% in September 2023.

CBSL said inflation is expected to stabilise around the targeted level of 5% over the medium term, supported by appropriate policy measures and well-anchored inflation expectations. Nevertheless, should there be any upward increases to administratively determined prices, tariffs or taxes by the Government, a transitory increase in inflation beyond the target is probable in the short term.