Sri Lanka Inflation Accelerates

Sri Lanka’s headline inflation in the capital Colombo accelerated to 4.1% during the 12 months to December from 3.4% due to faster rise in food and beverage prices and moderate increases in non-food prices, the data released by the country’s statistics department showed, NewsNow reported. The inflation measured by the Colombo consumer price index rose by 1.9 index points or 0.99% to 192. 8 during December from a month ago. However, the central bank last week attributed these spikes to transitory movements and thus left its key policy rates unchanged with the expectation of inflation remaining at mid-single digit levels in the period ahead. Sri Lanka’s CCPI headline inflation now remains lower than the upper limit of the inner band set by the International Monetary Fund for inflation by end December 2016 which is 6.4%.  The annual average inflation for December was 3.7%, up from 3.6% in November. The central bank’s inflation target for 2016 was 5%.