Inflation declines in April

The Year on Year inflation based on National Consumer Price Index (NCPI) has declined to 1.6% in April from 2.8% in March 2018. Issuing NCPI for the month of April 2018, Dr. Amara Satharasinghe, Director General of Census and Statistics said that the inflation of 1.6% is the lowest inflation reported since February 2016.

Contributions to the inflation in April from food group and non-food group are -0.2% and 1.7% respectively, whilst contributions of these two groups to the inflation in April 2017 were 5.2% and 3.3% respectively, resulting headline inflation of 8.4%.

However, when compared to month on month changes, NCPI in April 2018 has increased to 122.9 from 122.8 reported in March 2018. This change was contributed by increase of expenditure of non-food items by 0.12% and decrease of expenditure value of food items by 0.11%.

The decrease in expenditure value of food items were reported for vegetables, big onions, coconuts, eggs, gram, rice and green chilies. However, increases in expenditure value of food items were reported for limes, potatoes, tea dust, banana, chicken, fresh fish, dried chilies, infant milk powder and red onions.

The increases in expenditure value of non-food items in April 2018 compared to the previous month was due to the expenditure value increases in groups of ‘Alcoholic beverages, Tobacco and Narcotics’, ‘Clothing and Footwear’, ‘Housing, Water, Electricity, Gas and Other fuels’, ‘Furnishings, Household equipment and Routing household maintenance’ and ‘’Transport’. In the ‘Housing, Water, Electricity, Gas and Other fuels’ group expenditure value increase was due to increase in price of LP Gas with effect from 28 April, 2018 and in the ‘Transport’ group expenditure value increase was due to increase in price of fuel with effect from March, 2018. Further, the group of ‘Miscellaneous Goods and Services’ recorded very slight expenditure value increase compared to the preceding month. Meanwhile, the expenditure value of ‘Health’, ‘Communication’, ‘Recreation and Culture’, ‘Education’ and ‘Restaurants & Hotels’ groups remained unchanged during the month.