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Sri Lanka national inflation rises to 6.1-pct in August 2020

ECONOMYNEXT – Sri Lanka’s national inflation rose to 6.1 percent to 6.2 percent in August 2020 from a year earlier with consumer prices in the month rising 0.4 percent, data from the state statistics office showed.

Sri Lanka’s National Consumer Price Index grew to 137.8 points in August from 137.3 points in July with food prices rising 0.5 percent.

Sri Lanka’s food prices have risen 13.2 percent in the 12 months to August 2020 accelerating from 12.9 percent in July.

Non-foods grew 1.1 percent in the 12-months.

The Colombo Consumer Price Index, rose at a slower pace of 4.8 percent in the 12-months to August.

Sri Lanka printed unprecedented volumes of money in March and April, driving a soft-peg with the US dollar close to 200 rupees.

But the country is under an import embargo not seen since the collapse of the Bretton Woods system of soft-pegs in 1971.

Private credit contracted After April and the central bank bought dollars preventing the appreciation fo the rupee above 185 levels.

Meanwhile excess liquidity remains in the banking system and stock prices have started to go up. (Colombo/Sept21/2020)

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