Sri Lanka’s consumer prices fell 0.8% year-on-year in April after a 1.9% decline in March, official data showed on Wednesday, as the economy recovers from its deepest financial crisis in decades.
The National Consumer Price Index captures broad retail price trends and is released with a lag of 21 days every month.
The rate of price increases in the food category climbed to 2.9% in April from 0.8% in March. In the non-food category, however, prices fell 3.7% in April compared with the same month last year, compared with the previous month’s 4.1% annual drop.
“Inflation is starting to come up but largely in line with expectations. By August inflation is likely to turn positive,” said Shehan Cooray, head of research at HNB Stockbrokers.
Sri Lanka, which was plunged into a financial crisis due to a record shortage of dollars three years ago, has recovered strongly, posting 5% economic growth last year.
The island nation has seen inflation reduce significantly over the last year, supporting a gradual lowering of interest rates.
The Central Bank of Sri Lanka is expected to keep its policy rates unchanged at 8% on Thursday to maintain stable growth and deepen the island nation’s recovery from the financial crisis.
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