Economists have highlighted the depreciation of the Sri Lankan rupee, the appreciation of the US dollar and the increase in the prices of rice as the factors which had resulted in the marginal increase of inflation.
The Department of Census and Statistics said that inflation, measured by the change in the National Consumer Price Index, had increased marginally by 0.1% (from 6.7% to 6.8%) from November to December last year (116.6 points to 118 points). The annual average Index Core inflation too had increased slightly from 5.8% in November to 5.9% in December.
Increase in prices of items in the food and non-food categories have contributed to this situation.
Head of the Department of Economics of the Faculty of Arts of the University of Colombo, Prof. W. Wimalaratana said that the staple diet had been affected heavily by adverse weather conditions.
He said that there was no proper mechanism to distribute the available rice stocks while adding that the procedure available in this regard was inefficient.
“Naturally, the prices of imported goods and goods made based on imported raw materials go up when the rupee depreciates. The US dollar is appreciating in the money markets. The prices of items go up. Although, the prices of fuel have fluctuated in the world market, locally there has been no change. Food items are expensive. There are also hidden factors when it comes to rice,” he explained.
(R L J)