Inflation at 4.2% in February

Headline inflation based on the year-on-year (YOY) change as per on the National Consumer Price Index (NCPI) has been measured at 4.2%.

Core inflation, which reflects the underlying inflation by excluding volatile items of food, energy and transport groups in the economy as measured by the YOY change based on NCPI for the month of February, has declined to 4.1% from 4.2% in January 2021.

Census and Statistics Acting Director General said the headline inflation reported for the month of January 2021 was 3.7%. Contributions to the inflation rate of February from food group and non-food group are 3.2% and 1.0% respectively. Contributions of food and non-food groups to the inflation in February 2020 were 7.0% and 1.2% respectively, it resulted in a headline inflation of 8.1%. 

Comparing the month-on-month changes, NCPI in February 2021 has increased to 142.8 from 142.1 reported in January 2021. This shows an increase of 0.7 index points or 0.5% as compared to January 2021. The month-on-month change was contributed by increases of index values of food items by 0.42% and non-food items by 0.09% respectively. 

Price increases of food items were reported for vegetables, green chilies, coconuts, rice, fresh fish, eggs, coconut oil, fresh fruits, red onions, Mysore dhal, tamarind, green gram, turmeric powder, chili powder and canned fish.  However, price decreases of food items were reported for potatoes, big onions, sugar, limes, jak, jak seeds and chicken.

The increases in index values of non-food groups in February compared to the previous month was mainly due to the price increases in groups of items ‘Transport’ (Tyres, tubes and spare parts), ‘Furnishing, Household equipment and Routine household maintenance’ and ‘Clothing and Footwear’. 

Further, very slight price increases were reported in groups of ‘Alcoholic Beverages, Tobacco and Narcotics’ and ‘Miscellaneous Goods and Services’ as well. Meanwhile, the price indices of ‘Housing, Water, Electricity, Gas and Other fuels’, ‘Health’, ‘Communication’, ‘Recreation and Culture’, ‘Education’ and ‘Restaurants and Hotels’ groups remained unchanged during the month.