Sri Lanka’s headline inflation as measured by the year-on-year change in the National Consumer Price Index (NCPI), has decreased to 7.0% in March 2020 from 8.1% in February 2020, the statistics office said.
Contributions to the inflation rate of March 2020 from food group and non-food group are 6.0% and 1.0% respectively. Whilst contributions of food and non-food groups to the inflation in March 2019 were -1.0% and 3.9% respectively, resulting in a headline inflation of 2.9%.
With respect to March 2019, the reported increase in percentage of food group was mainly due to higher price levels prevailed in this month of March 2020, particularly prices of coconuts, rice, vegetables, big onions, fresh fish and red onions.
Comparing the month-on-month changes, NCPI in March 2020 has decreased to 135.2 from 137.0 reported in February 2020. This shows a decrease of 1.8 index points or 1.3 percentage as compared to February 2020.The month-on-month change was contributed by decrease of index values of food items by 1.41% and increase of index values of non-food items by 0.09%.
Price decreases of food items were reported for vegetables, red onions, rice, potatoes, mysore dhal, green chilies, dried fish, fresh fish, bread, eggs and chicken. However, price increases of food items were reported for coconuts, coconut oil, fresh fruits, garlic, chili powder, yoghurt and big onions.
The increases in index values of non-food groups in March 2020 compared to the previous month was due to the price increases in groups of items ‘Alcoholic Beverages, Tobacco & Narcotics’ (Betel leaves), ‘Health’ (Payments to medical laboratory tests), ‘Transport’ (Airline fare) and ‘Clothing and Footwear’. Meanwhile, the price indices of ‘Housing, Water, Electricity, Gas and Other fuels’, ‘Furnishing, Household equipment Routine household maintenance’, ‘Communication’, ‘Recreation and Culture’, ‘Education’, ‘Restaurants and Hotels’ and ‘Miscellaneous Goods and Services’ groups remained unchanged during the month.
Core inflation, which reflects the underlying inflation by excluding volatile items of food, energy and transport groups in the economy as measured by the Year-on-Year change based on NCPI for the month of March 2020 has declined to 3.2% from 3.4% in February 2020.