February inflation dips to 10-month low of 3.2%

Year-on-year inflation based on NCPI has declined to 3.2% in February from 5.4% in January 2018, the Census and Statistics Department said.

Its Director General Dr. Amara Satharasinghe in a statement said the February figure was the lowest inflation reported since April 2016.

The reported inflation for the month of February 2018 was mainly due to comparatively higher price levels prevailed in February2017 and decline in food prices in February 2018. Contributions to the inflation in February 2018 from food group and non-food group are 1.6% and1.5% respectively, whilst contributions of these two groups to the inflation in February 2017 were 4.5% and 3.8% respectively, resulting in headline inflation of 8.2%.

When compared to month on month changes, NCPI in February2018 has decreased to 123.7 from 125.8 reported in January 2018. This shows a decrease of 2.1 index points that is 1.7 percentage points in February 2018 as compared to January 2018. This month on month change was contributed by decrease of expenditure value of food items by 1.96% and increase of non-food items by 0.35%.

The decrease in expenditure value of food items was due to the price decreases of vegetables, green chilies, red onions, rice, big onions, banana, Mysore dhal, fresh fish, potatoes sugar, limes and papaw. However, increases in expenditure value in index were reported for coconuts, chillie powder and chicken. 

The increase in expenditure value of non-food items in February 2018 compared to the previous month was due to the expenditure value increases in groups of ‘Education’, ‘Health’, ‘Clothing and Footwear’, ‘Miscellaneous Goods and Services’, ‘Housing, Water, Electricity, Gas and Other fuels’, ‘Furnishing, Household equipment and Routine household maintenance’, ‘Alcoholic beverages, Tobacco and Narcotics’, ‘Transport’ and ‘Recreation and Culture’. 

Further, the group of ‘Restaurant and Hotels’ recorded very slight expenditure value increase compared to the preceding month. The expenditure value of ‘Communication’ group remained unchanged during this month.