Price increases: Five months in a row

The general price level increased in December 2009 compared to the prices in the previous month, continuing the positive trend for the fifth consecutive month for the year except August 2009.

The Colombo Consumers’ Price Index (C.C.P.I.) for all items for December 2009 was 213.5, a 2.5 index point or 1.2 percentage increase was noted from November 2009 index which was 211.0. This increase represents expenditure value of Rs 441.78 in the “Market Basket.”

Month-On-Month

Food commodity prices recorded an increasing trend due to the less supply of agricultural consumer goods, specially rice, vegetables, fish and sea food and coconut from main producing areas from November to December. On an average, expenditure value on items in Food group increased by Rs 416.02. Retail prices of  rice, vegetables, fish and sea food, coconut and potatoes increased due to less supply from main producing areas. Table 2 depicts that contribution to the increase in CCPI from November to December 2009.

It shows the “all item” of food and non food groups increased by 1.2%.  It should be noted that in this basket certain items play a more significant part than the others, depending on the weight of the Market basket of household consumption.

Of the total increase of 1.2%, food items accounted for an increase of 1.1% mainly due to vegetables (0.32%),  fish and sea food (0.28%), green chillies (0.25%), Coconut (0.18%), eggs (0.14%), rice (0.08%) and chicken (0.07%). There is also an increase  of  0.03% and   0.02%  in major groups of  Clothing & Footwear  and  Recreation and culture respectively.

Year-On-Year

The rate of inflation as measured by the C.C.P.I. on a year on year (y.o.y.) basis increased to 4.8% in December 2009, from 2.8% recorded in November 2009 (See Table 3).

However, Sri Lanka’s 12 month moving Average inflation as measured by the Colombo Consumers’ Price index (C.C.P.I.) settled  in the month of December one digit figure of “3.4% for the fifth time after 2 1/2 years from November 2006.”

On a y.o.y.basis, the highest contribution to the overall increase of around 62% came from food commodities which increased by 3% in December 2009. The combined effects of both domestically produced and imported food commodities contributed to the increase in the food sub Index (see Table 4).

Among the food commodities, rice, vegetable, coconuts and coconut oil which have significant weights in the C.C.P.I. basket recorded price increases on a y.o.y. basis. Under the non food category, the prices of kerosene oil, diesel and gas came down by 15%, 9% and 13% respectively. However the price of Petrol went up by 7%.
(Census  & Statistics Department)