Sri Lanka’s nation-wide inflation galloped 66.7 percent in the 12 – months to July 2022, the state statistics office said, amid the worst currency triggered by the islands intermediate regime Central Bank.
Central Bank Governor Nandalal Weerasinghe recently said that the bank is optimistic that inflation will be around 60-65 in the comming months and it will go up to 70 percent in September in aacordance with their projections .
But the Deartment of Census and Statistics announced that Sri Lanka’s nationwide inflation in July 2022 determined under the National Consumer Price Index (NCPI) rose to 66.7 percent from 58.9 percent recorded in May 2022 on a year-on-year basis.
CB Governor is trying to mislead the masses and international financial agencies including the International Monetary Fund (IMF) announcing the shrinked data of inflation . The inflation targeting is the responsibilty of the Central Bank
The NCPI for all items for the month of July 2022 increased to 244.4 from 231.5 in the previous month.With respect to July 2021, the reported inflation for the month of July 2022 was mainly due to the higher price levels prevailed in both food and non-food groups.
Accordingly, the Year-on-Year inflation of the food group increased to 82.5 percent in July 2022 from 75.8 percent in May 2022 and the Year-on-Year inflation of the non-food group increased to 52.4 percent in July 2022 from 43.6 percent in previous month.
Contributions to the inflation rate of July 2022 from food group and non-food group are 39.28 percent and 27.44 percent respectively.
The moving average inflation for the month of July 2022 is 25.9 percent. The corresponding rate for the month of June 2022 was 20.8 percent.
Sri Lanka has a reserves collecting soft-peg but under ‘flexible’ inflation targeting it was bombarded with liquidity injection until in collapsed repeatedly and eventually the country ended up in default.
The Central Bank in April allowed interest rates to go up and private credit has collapsed and inflation especially from traded goods and food is starting to ease. However services prices tend to go up for a longer period.
