February inflation rises to 4%

Inflation in February rose slightly to 4% from 3.7% in January, largely due to increases in non-food items, according to the Census and Statistics Department.

The YoY inflation as measured by CCPI is 4.0% in February 2019 and inflation calculated for January was 3.7% (Table3). YoY inflation of Food Group has increased from ‐2.1% in January 2019 to ‐1.4% in February 2019 and that of Non‐food Group has increased from 6.3% in January to 6.4% in February during this period.

The CCPI for all items for the month of February 2019 was 126.8 and it records a decrease of 0.6 index points that is 0.51 percentage points compared to the month of January 2019 for which the index was 127.4. This represents a decrease of expenditure value by Rs.390.26 in the ‘Market Basket’.

A decrease in the index point by 0.51% was due to the expenditure value decrease of Food items by 0.61% and increase of Non Food items by 0.11%.   

For the month of February 2019, on year to year basis, contribution to inflation by food commodities was ‐0.41%. The contribution of Non Food items was 4.43%. This was mainly due to increases in value change in groups of ‘Housing, Water, Electricity, Gas and Other Fuels’ (1.32%), ‘Education’ (1.03%), ‘Transport’ (0.71%), ‘Health’ (0.70%), ‘Restaurants & Hotels’ (0.38%), ‘Furnishing Household Equipment’s & Routine Household Maintenance’ (0.20%), ‘Clothing and Footwear’ (0.15%), ‘Alcoholic Beverages Tobacco and Narcotics’ (0.12%), ‘Miscellaneous Goods and Services’ (0.04%) and ‘Recreation and Culture’ (0.04%) and decrease in value change were reported for the group ‘Communication’ (0.26%).   

The moving average inflation rate for the month of February was 4.1%. The corresponding rate for the month of January was also 4.1%.

The CCPI is an economic indicator constructed to measure inflation which is defined as percentage change in CCPI over the year. There are two measures of inflation in general use. One measure is year on year base or point to point inflation (the percentage change in the CPI during the last 12 months). The other measure is moving average inflation (the percentage difference between the average price index of last 12 months and the average price index of previous 12 months).