NCPI accelerates to three-year high 8.1% in Aug.

Wednesday, 23 September 2026 05:21 - - {{hitsCtrl.values.hits}}

National inflation accelerated further to 8.1% year-on-year (YoY) in August 2026, up from 7.2% in July, extending the three-year high reached the previous month, according to the latest National Consumer Price Index (NCPI) data from the Department of Census and Statistics (DCS).

The National Consumer Price Index (Base: 2021=100) rose to 223.9 points in August from 223.4 in July, a month-on-month (MoM) increase of 0.5 index points or 0.26%, corresponding to a rise of Rs. 291.15 in the expenditure value of the market basket.

The August reading continues a steady climb that has defined 2026 so far. Having bottomed out at 1.6% in February, YoY inflation has risen in every month since: 2.4% in March, 4.7% in April, 5.4% in May, 6.5% in June, 7.2% in July, and now 8.1% in August. The pace of increase has itself been accelerating, with the monthly jump from July to August, 0.9 percentage points, among the steepest of the year.

That trend is corroborated by the 12-month moving average, a smoother gauge less prone to month-to-month noise, which rose to 4.1% in August from 3.5% in July. A rising moving average alongside a rising spot rate suggests the current bout of inflation reflects a genuine broadening of price pressure rather than a temporary base effect that will soon unwind.

Food inflation jumped to 6.6% YoY in August from 4.9% in July, while non-food inflation ticked up to 9.3% from 9.2%. Non-food items remained the larger driver of the headline rate, contributing 5.14 percentage points to the 8.1% figure, against 2.96 percentage points from food.

Within non-food, Transport was by far the biggest single contributor, adding 2.28 percentage points to annual inflation, driven overwhelmingly by Petrol, which alone contributed 1.14 percentage points, with Diesel adding a further 0.16 percentage points. That points to imported energy costs as a key pressure point, consistent with the higher global energy prices Fitch Ratings flagged this month as a drag on Sri Lanka’s external accounts. Housing, Water, Electricity, Gas and Other Fuels added a further 1.20 percentage points, led by Housing Rent (0.46 points) and Materials for Maintenance (0.30 points), while Restaurants and Hotels (0.52 points) and Education (0.35 points) also contributed meaningfully.

On the food side, Fresh Fish (0.85 points), Dried Fish (0.45 points), Green Chillies (0.37 points) and Big Onions (0.28 points) drove the annual increase, partly offset by declines in Coconuts (-0.45 points) and Rice (-0.26 points).

On a MoM basis, the 0.26% rise in the NCPI in August was driven mainly by food items, up 0.18%, against 0.08% from non-food. Fresh Fruits, Milk Powder and Dried Fish each contributed 0.06-0.07 percentage points to the monthly increase, while Rice (-0.08 points) and Vegetables (-0.05 points) pulled in the other direction. Among non-food items, Transport (Bus Fare) added 0.04 percentage points for the month, while LP Gas prices eased, subtracting 0.02 points.

The NCPI covers the entire country and comprises 485 items drawn from the 2019 Household Income and Expenditure Survey. The index was rebased to 2021=100 from the previous 2013=100 series.