Sri Lanka’s overall inflation rate, measured by the Colombo Consumer Price Index (CCPI) on a year-on-year basis, has increased to 4.0% in December from 3.4% in November.
In its latest release, the Census & Statistics Department (DCS) reported that food inflation rose to 0.3% in December 2023, rebounding from -3.6% in November 2023. Meanwhile, the year-on-year inflation of the non-food group decreased to 5.8% in December from 6.8% in November.
In December, the contribution to inflation by food commodities was 0.10%, while the contribution of non-food items was 3.90%. According to the DCS, this was primarily due to increases in the value change within the housing, water, electricity, gas & other fuels, education, clothing & footwear, alcoholic beverages, tobacco & narcotic, recreation & culture, health, and miscellaneous goods & services groups.
Conversely, a decrease in value change was reported for the groups of transport, furnishing household equipment and routine household maintenance, restaurants and hotels, and health. Additionally, a marginal price increase was noted in the communication group during the month.
The CCPI serves as an economic indicator designed to measure inflation, defined as the percentage change in the CCPI over the year. Two commonly used measures of inflation are the year-on-year base or point-to-point inflation (percentage change in the CPI during the last 12 months) and ‘moving average inflation’ (percentage difference between the average price index of the last 12 months and the average price index of the previous 12 months).
