COLOMBO, Sri Lanka: The Department of Census and Statistics in Sri Lanka said consumer inflation surged to 70.2 percent in August, as the island country suffers from its worst economic crisis in decades.
In a statement, the department said the National Consumer Price Index (NCPI) rose 70.2 percent last month compared to last year, after a 66.7 percent increase in July, while food prices rose 84.6 percent and prices of non-food items increased 57.1 percent.
In August, the Central Bank of Sri Lanka said the country's inflation rate would stabilize after peaking at around 70 percent.
The NCPI captures broader retail price inflation and is released with a lag of 21 days every month.
Published at the end of each month, the Colombo Consumer Price Index (CCPI), a leading indicator for national prices that highlights inflation trends in Sri Lanka's largest city, rose 64.3 percent in August.
Amidst shortages in fertilizers and fuel, Sri Lanka's economy shrank 8.4 percent in the quarter through June from one year ago, one of the steepest declines over a three-month period.
"Inflation is expected to taper from September. However, inflation is only likely to moderate and reach single digits in the second half of 2023," said Dimantha Mathew of investment
firm First Capital, as quoted by Reuters.
Caused by economic mismanagement and the repercussions of the COVID-19 pandemic, a shortage in U.S. dollars has meant that Sri Lanka has struggled to pay for key imports, such as fuel, fertilizer, food and medicine.
Earlier this month, Sri Lanka reached a preliminary deal with the International Monetary Fund for a loan of some $2.9 billion.