CB says YoY inflation rose in June due to rise in food prices, lower base

Inflation, as measured by the Colombo Consumers’ Price Index (CCPI) (2006/07=100) computed by the Department of Census and Statistics, increased to 5.8% in June 2012, on an annual average basis, from 5.6% in the previous month.

The year-on-year (YoY) inflation rose to 9.3% in June 2012 from 7.0% in May 2012, mainly due to price increases in some food items and the lower base recorded in June 2011.

Meanwhile, core inflation, decelerated for the ninth consecutive month to 5.7% in June 2012, on an annual average basis, from 6.0% in May 2012, while increasing on a YoY basis to 5.8% in June 2012 from 4.8% in the previous month.

The general price level as indicated by the Index recorded an increase of 1.9% in June 2012 over that of the previous month, with the CCPI increasing in absolute terms to 165.2 from 162.1.

The contribution to the monthly increase in the Index came mainly from price increases in the food and non-alcoholic beverages category (by 3.8%) followed by the non-food category (by 0.4%). The rise in the prices of fresh fish, eggs, vegetables, lime, green chilli, red onion, big onion and potatoes due to seasonal factors and the upward revision in the prices of wheat flour, bread and milk powder, contributed to the increase in the CCPI. However, a decline in the prices of fruits, leafy vegetables and sugar was also reported during the month.

Within the non-food category, prices increased in the sub-categories of housing, water, electricity, gas and other fuels (by 1.0%); clothing and footwear (by 0.5%); miscellaneous goods and services (by 0.4%); furnishing, household equipment and routine household maintenance (by 0.3%) and health (by 0.1%). Meanwhile, the prices in the sub-categories of transport; communication; recreation and culture; and education remained unchanged during the month.