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Sri Lanka’s inflation at 4.1-pct in August 2020

ECONOMYNEXT – Sri Lanka’s inflation slowed to 4.1-pct in August 2020, from 4.2 percent in July, data from the state statistics office showed.

The Colombo Consumer Price Index was unchanged at 135.4 points with non-foods falling, while the food index climbed to 148.4 points from 148.0 in July.

The food sub-index grew 12.3 percent in the 12 months to August 2020.

Sri Lanka’s central bank printed large volumes of money in March and April and allowed the rupee to fall steeply in a so-called flexible exchange rate, where money is printed but no intervention is made to mop up the rupees through dollar sales.

The rupee fell towards 200 to the US dollar and has been allowed to appreciate as private credit turned negative in May.

The non-food index grew 12.3 percent in the 12-month to August.

Year-to-date inflation in 2020 has been lower than in 2019. (Colombo/Aug31/2020).