Headline inflation as measured by the year-on-year change in the National Consumer Price Index (NCPI, 2013=100)1 decreased to 3.5 per cent in May 2019 from 3.6 per cent in April 2019 due to the high base prevailed in the corresponding month of the previous year. Meanwhile, in May 2019, year-on-year Food and Non-food inflation recorded -0.4 per cent and 6.7 per cent respectively.

The change in the NCPI measured on an annual average basis increased marginally to 2.0 per cent in May 2019 from 1.9 per cent in April 2019.

When monthly change is considered, the NCPI increased by 1.1 per cent in May 2019 with the increases observed in the prices of the items in both Food and Non-food categories. Within the Food category, prices of vegetables, fresh fish, limes, potatoes and milk powder recorded increases. In addition, within the Non-Food category, prices of the items in Transport; Health; and Recreation and Culture sub-categories increased during the month.

The core inflation, which reflects the underlying inflation in the economy, remained unchanged at 6.3 per cent in May 2019 on year-on-year basis. However, the monthly increase of 0.3 per cent observed in core NCPI in May 2019 was driven by increases in prices of items in the Food category, mainly in milk powder, and the Non-food category particularly in Transport (Purchase of vehicle); Recreation and Culture; and Health sub-categories. Annual average NCPI Core inflation increased to 4.0 per cent in May 2019 from 3.7 per cent in April 2019.