Headline inflation as measured by the year-on-year (Y-o-Y) change in the Colombo Consumer Price Index (CCPI, 2013=100)1 marginally decreased to 4.0% in September 2020 from 4.1% in August 2020.

This was driven by the statistical effect of the high base prevailed in September 2019. Food inflation (Y-o-Y) decreased to 11.5% in September 2020 from 12.3% in August 2020, whereas Non-food inflation (Y-o-Y) increased to 0.9 per cent in September 2020 from 0.8 per cent in August 2020.

The change in the CCPI measured on an annual average basis also decreased to 4.7% in September 2020 from 4.8% in August 2020.

Monthly change of CCPI recorded at 0.7% in September 2020. This was due to price increases observed in items of both Food and Non-food categories. Accordingly, within the Food category prices of vegetables, coconut, fresh fruits and big onion increased in September 2020. Within the Non-food category, prices of items in Alcoholic beverages, Tobacco and Narcotic, and Transport sub-categories increased during the month.

The core inflation (Y-o-Y), which reflects the underlying inflation in the economy, declined to 2.9% in September 2020 from 3.2% in August 2020. Moreover, annual average core inflation also declined to 3.6% in September 2020 from 3.8% in August 2020.