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Sri Lanka national consumer prices down 0.7-pct in January

Feb 23, 2016 17:11 PM GMT+0530 | 0 Comment(s)

ECONOMYNEXT - Sri Lanka's country-wide consumer prices fell 0.7 percent in the year to January 2016 helped by a steep fall in food commodities in January, the state statistics office said.

Vegetables (a non-trade item) and rice prices also fell with the National Consumer Price Index falling
0.7 percent during the month.

The central bank printed large volumes of money but they were dissipated in the forex market through imports of cars and other items.

Global commodity prices have fallen over the last year as the dollar strengthened, despite Sri Lanka's rupee also falling from 131 to 144 to the US dollar.

Defending a dollar peg is important to kill liquidity and force a hike in interest rates.