COLOMBO (EconomyNext) – Sri Lanka’s consumer prices rose 0.2 percent in the 12-months to May 2015, with prices rising 0.7 percent during the month, data from the state statistics office showed.
Consumer prices also rose 0.2 percent in April, but the annual figure is low, mostly due to a sharp 2.3 percent drop in the index in February after the state cut taxes on some consumer goods and dropped fuel prices.
Analysts warned at the time that the price cuts came at the expense of credit pressure on the monetary system as state energy enterprises and the central government would have to borrow more as a result of what appeared to be a positive ‘supply shock’.
Food and non-alcoholic beverage rose 1.5 percent in May, but non-food were flat. In March non-foods rose 1.9 percent and in April 1.4 percent, some of the highest monthly rises seen since the new index was compiled.